Exhibit 4.1
EXECUTION COPY
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HAIGHTS CROSS OPERATING COMPANY
and each of the Guarantors party hereto
11 3/4% SENIOR NOTES DUE 2011
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INDENTURE
Dated as of August 20, 2003
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Xxxxx Fargo Bank Minnesota, N.A.
Trustee
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CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
310(a)(1) ............................................................ 7.10
(a)(2) ............................................................ 7.10
(a)(3) ............................................................ N.A.
(a)(4) ............................................................ N.A.
(a)(5) ............................................................ 7.10
(b) ............................................................... 7.10
(c) ............................................................... N.A.
311(a) ............................................................... 7.11
(b) ............................................................... 7.11
(c) ............................................................... N.A.
312(a) ............................................................... 2.05
(b) ............................................................... 12.03
(c) ............................................................... 12.03
313(a) ............................................................... 7.06
(b)(2) ............................................................ 7.06; 7.07
(c) ............................................................... 7.06; 12.02
(d) ............................................................... 7.06
314(a) ............................................................... 4.03; 12.02; 12.05
(c)(1) ............................................................ 12.04
(c)(2) ............................................................ 12.04
(c)(3) ............................................................ N.A.
(e) ............................................................... 12.05
(f) ............................................................... N.A.
315(a) ............................................................... 7.01
(b) ............................................................... 7.05, 12.02
(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) ............................................................... 2.12
317(a)(1)............................................................. 6.08
(a)(2) ............................................................ 6.09
(b) ............................................................... 2.04
318(a) ............................................................... 12.01
(b) ............................................................... N.A.
(c) ............................................................... 12.01
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 ........................................................... 21
Section 1.03 Incorporation by Reference of Trust Indenture Act ........................... 22
Section 1.04 Rules of Construction ....................................................... 22
ARTICLE 2.
THE NOTES
Section 2.01 Form and Dating ............................................................. 23
Section 2.02 Execution and Authentication ................................................ 24
Section 2.03 Registrar and Paying Agent .................................................. 24
Section 2.04 Paying Agent to Hold Money in Trust ......................................... 25
Section 2.05 Holder Lists ................................................................ 25
Section 2.06 Transfer and Exchange ....................................................... 25
Section 2.07 Replacement Notes ........................................................... 37
Section 2.08 Outstanding Notes ........................................................... 37
Section 2.09 Treasury Notes .............................................................. 38
Section 2.10 Temporary Notes ............................................................. 38
Section 2.11 Cancellation ................................................................ 38
Section 2.12 Defaulted Interest .......................................................... 38
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee .......................................................... 39
Section 3.02 Selection of Notes to Be Redeemed or Purchased .............................. 39
Section 3.03 Notice of Redemption ........................................................ 39
Section 3.04 Effect of Notice of Redemption .............................................. 40
Section 3.05 Deposit of Redemption or Purchase Price ..................................... 40
Section 3.06 Notes Redeemed or Purchased in Part ......................................... 41
Section 3.07 Optional Redemption ......................................................... 41
Section 3.08 Mandatory Redemption ........................................................ 42
Section 3.09 Offer to Purchase by Application of Excess Proceeds ......................... 42
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes ............................................................ 43
Section 4.02 Maintenance of Office or Agency ............................................. 44
Section 4.03 Reports ..................................................................... 44
Section 4.04 Compliance Certificate ...................................................... 45
Section 4.05 Taxes ....................................................................... 46
Section 4.06 Stay, Extension and Usury Laws .............................................. 46
Section 4.07 Restricted Payments ......................................................... 46
Section 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries .............. 49
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock .................. 50
Section 4.10 Asset Sales ................................................................. 53
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Section 4.11 Transactions with Affiliates ................................................ 55
Section 4.12 Liens ....................................................................... 56
Section 4.13 Business Activities ......................................................... 56
Section 4.14 Corporate Existence ......................................................... 56
Section 4.15 Offer to Repurchase Upon Change of Control .................................. 56
Section 4.16 Limitation on Sale and Leaseback Transactions ............................... 58
Section 4.17 Payments for Consent ........................................................ 58
Section 4.18 Additional Note Guarantees .................................................. 58
Section 4.19 Designation of Restricted and Unrestricted Subsidiaries ..................... 58
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets .................................... 59
Section 5.02 Successor Corporation Substituted ........................................... 59
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default ........................................................... 60
Section 6.02 Acceleration ................................................................ 61
Section 6.03 Other Remedies .............................................................. 63
Section 6.04 Waiver of Past Defaults ..................................................... 63
Section 6.05 Control by Majority ......................................................... 63
Section 6.06 Limitation on Suits ......................................................... 63
Section 6.07 Rights of Holders of Notes to Receive Payment ............................... 64
Section 6.08 Collection Suit by Trustee .................................................. 64
Section 6.09 Trustee May File Proofs of Claim ............................................ 64
Section 6.10 Priorities .................................................................. 65
Section 6.11 Undertaking for Costs ....................................................... 65
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee ........................................................... 65
Section 7.02 Rights of Trustee ........................................................... 66
Section 7.03 Individual Rights of Trustee ................................................ 67
Section 7.04 Trustee's Disclaimer ........................................................ 67
Section 7.05 Notice of Defaults .......................................................... 67
Section 7.06 Reports by Trustee to Holders of the Notes .................................. 67
Section 7.07 Compensation and Indemnity .................................................. 67
Section 7.08 Replacement of Trustee ...................................................... 68
Section 7.09 Successor Trustee by Merger, etc. ........................................... 69
Section 7.10 Eligibility; Disqualification ............................................... 69
Section 7.11 Preferential Collection of Claims Against Company ........................... 69
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance .................... 70
Section 8.02 Legal Defeasance and Discharge .............................................. 70
Section 8.03 Covenant Defeasance ......................................................... 70
Section 8.04 Conditions to Legal or Covenant Defeasance .................................. 71
Section 8.05 Deposited Money and Government Securities to be Held in Trust; Other
Miscellaneous Provisions .................................................................... 72
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Section 8.06 Repayment to Company ........................................................ 72
Section 8.07 Reinstatement ............................................................... 73
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes ......................................... 73
Section 9.02 With Consent of Holders of Notes ............................................ 74
Section 9.03 Compliance with Trust Indenture Act ......................................... 75
Section 9.04 Revocation and Effect of Consents ........................................... 75
Section 9.05 Notation on or Exchange of Notes ............................................ 75
Section 9.06 Trustee to Sign Amendments, etc. ............................................ 75
ARTICLE 10.
NOTE GUARANTEES
Section 10.01 Guarantees .................................................................. 76
Section 10.02 Limitation on Guarantor Liability ........................................... 77
Section 10.03 Execution and Delivery of Note Guarantee .................................... 77
Section 10.04 Guarantors May Consolidate, etc., on Certain Terms .......................... 77
Section 10.05 Releases .................................................................... 78
ARTICLE 11.
SATISFACTION AND DISCHARGE
Section 11.01 Satisfaction and Discharge .................................................. 79
Section 11.02 Application of Trust Money .................................................. 80
ARTICLE 12.
MISCELLANEOUS
Section 12.01 Trust Indenture Act Controls ................................................ 80
Section 12.02 Notices ..................................................................... 80
Section 12.03 Communication by Holders of Notes with Other Holders of Notes ............... 81
Section 12.04 Certificate and Opinion as to Conditions Precedent .......................... 82
Section 12.05 Statements Required in Certificate or Opinion ............................... 82
Section 12.06 Rules by Trustee and Agents ................................................. 82
Section 12.07 No Personal Liability of Directors, Officers, Employees and Stockholders .... 82
Section 12.08 Governing Law ............................................................... 82
Section 12.09 No Adverse Interpretation of Other Agreements ............................... 83
Section 12.10 Successors .................................................................. 83
Section 12.11 Severability ................................................................ 83
Section 12.12 Counterpart Originals ....................................................... 83
Section 12.13 Table of Contents, Headings, etc. ........................................... 83
EXHIBITS
Exhibit A1 FORM OF NOTE
Exhibit A2 FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Exhibit E FORM OF NOTE GUARANTEE
Exhibit F FORM OF SUPPLEMENTAL INDENTURE
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INDENTURE dated as of August 20, 2003 among Haights Cross Operating
Company, a Delaware corporation (the "Company"), the Guarantors (as defined)
and Xxxxx Fargo Bank Minnesota, N.A., as trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders (as
defined) of the 11 3/4% Senior Notes due 2011 (the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.
"144A Global Note" means a Global Note substantially in the form of
Exhibit Al hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person:
(1) 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, whether or not such Indebtedness is incurred in
connection with, or in contemplation of, such other Person merging with
or into, or becoming a Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.
"Additional Notes" means additional Notes (other than the Initial
Notes) issued under this Indenture in accordance with Sections 2.02 and 4.09
hereof, as part of the same series as the Initial Notes.
"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,"
as used with respect to any Person, means 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. For purposes of this definition, the terms
"controlling," "controlled by" and "under common control with" will have
correlative meanings.
"Agent" means any Registrar, co-registrar, Paying Agent or additional
paying agent.
"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 Depositary, Euroclear and Clearstream that apply to such transfer or
exchange.
"Asset Sale" means
(1) the sale, lease, conveyance or other disposition of
any assets or rights; provided that the sale, conveyance or other
disposition of all or substantially all of the assets of the Company
and its Restricted Subsidiaries taken as a whole will be governed by
the provisions of
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Section 4.15 hereof and/or Section 5.01 hereof and not by the
provisions of the Section 4.10 hereof; and
(2) the issuance of Equity Interests in any of the
Company's Restricted Subsidiaries or the sale of Equity Interests in
any of its Subsidiaries.
Notwithstanding the preceding, none of the following items
will be deemed to be an Asset Sale:
(1) any single transaction or series of related
transactions that involves assets or Equity Interests having a Fair
Market Value of less than $1.0 million;
(2) a transfer of assets between or among the Company and
its Restricted Subsidiaries;
(3) an issuance of Equity Interests by a Restricted
Subsidiary of the Company to the Company or to a Restricted Subsidiary
of the Company;
(4) the sale or lease of products, services, accounts
receivable or other assets in the ordinary course of business and any
sale or other disposition of damaged, worn-out or obsolete assets in
the ordinary course of business;
(5) the sale or other disposition of cash or Cash
Equivalents;
(6) the licensing of intellectual property for Fair
Market Value in the ordinary course of business; and
(7) a Restricted Payment or Permitted Investment that is
permitted by Section 4.07 hereof.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value 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. Such
present value shall be calculated using a discount rate equal to the rate of
interest implicit in such transaction, determined in accordance with GAAP;
provided, however, that if such sale and leaseback transaction results in a
Capital Lease Obligation, the amount of Indebtedness represented thereby will be
determined in accordance with the definition of "Capital Lease Obligation."
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "Person" (as that term is used in Section 13(d)(3)
of the Exchange Act), such "Person" will be deemed to have beneficial ownership
of all securities that such "Person" has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only after the passage of time. The terms "Beneficially Owns" and
"Beneficially Owned" have a corresponding meaning.
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"Board of Directors" means:
(1) with respect to a corporation, the board of directors
of the corporation or any committee thereof duly authorized to act on
behalf of such board;
(2) with respect to a partnership, the Board of Directors
of the general partner of the partnership;
(3) with respect to a limited liability company, the
managing member or members or any controlling committee of managing
members thereof; and
(4) with respect to any other Person, the board or
committee of such Person serving a similar function.
"Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination is to
be made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP, and the Stated Maturity thereof shall be the date of the last payment of
rent or any other amount due under such lease prior to the first date upon which
such lease may be prepaid by the lessee without payment of a penalty.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any
and all shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(3) in the case of a partnership or limited liability
company, partnership interests (whether general or limited) or
membership interests; and
(4) 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, but excluding from all
of the foregoing any debt securities convertible into Capital Stock,
whether or not such debt securities include any right of participation
with Capital Stock.
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or
instrumentality of the United States government (provided that the full
faith and credit of the United States is pledged in support of those
securities) having maturities of not more than one year from the date
of acquisition;
(3) certificates of deposit and eurodollar time deposits
with maturities of one year or less from the date of acquisition,
bankers' acceptances with maturities not exceeding one year and
overnight bank deposits, in each case, with any domestic commercial
bank having capital and surplus in excess of $500.0 million and a
Thomson Bank Watch Rating of "B" or better;
3
(4) repurchase obligations with a term of not more than
30 days for underlying securities of the types described in clauses (2)
and (3) above entered into with any financial institution meeting the
qualifications specified in clause (3) above;
(5) commercial paper having one of the two highest
ratings obtainable from Xxxxx'x Investors Service, Inc. or Standard &
Poor's Rating Services and in each case maturing within one year after
the date of acquisition; and
(6) money market funds at least 95% of the assets of
which constitute Cash Equivalents of the kinds described in clauses (1)
through (5) of this definition.
"Change of Control" means
(1) the direct or indirect sale, transfer, conveyance or
other disposition (other than by way of merger or consolidation), in
one or a series of related transactions, of all or substantially all of
the properties or assets of the Company and its Subsidiaries taken as a
whole to any "person" (as that term is used in Section 13(d) of the
Exchange Act) other than a Principal or a Related Party of a Principal;
(2) the adoption of a plan relating to the liquidation or
dissolution of the Company;
(3) the consummation of any transaction (including,
without limitation, any merger or consolidation) the result of which is
that any "person" (as defined above) other than a Principal or a
Related Party of a Principal becomes the Beneficial Owner, directly or
indirectly, of more than 50% of the Voting Stock of the Company,
measured by voting power rather than number of shares;
(4) the Company consolidates with, or merges with or
into, any Person, or any Person consolidates with, or merges with or
into, the Company, in any such event pursuant to a transaction in which
any of the outstanding Voting Stock of the Company or such other Person
is converted into or exchanged for cash or Cash Equivalents, securities
or other property, other than any such transaction where the Voting
Stock of the Company outstanding immediately prior to such transaction
is converted into or exchanged for Voting Stock (other than
Disqualified Stock) of the surviving or transferee Person constituting
a majority of the outstanding shares of such Voting Stock of such
surviving or transferee Person (immediately after giving effect to such
issuance);
(5) after an initial public offering of the Company or
any direct or indirect parent of the Company, the first day on which a
majority of the members of the Board of Directors of the Company are
not Continuing Directors; or
(6) the first day on which Parent ceases to own a
majority of the outstanding Equity Interests of the Company.
"Clearstream" means Clearstream Banking, S.A.
"Consolidated Cash Flow" means, with respect to any specified Person
for any period, the Consolidated Net Income of such Person for such period plus,
without duplication:
(1) an amount equal to any extraordinary loss plus any
net loss realized by such Person or any of its Restricted Subsidiaries
in connection with (a) an Asset Sale or (b) the
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extinguishment of any Indebtedness of such Person or any of the
Restricted Subsidiaries, in each case, to the extent such losses were
deducted in computing such Consolidated Net Income; plus
(2) provision for taxes based on income or profits of
such Person and its Restricted Subsidiaries for such period, to the
extent that such provision for taxes was deducted in computing such
Consolidated Net Income; plus
(3) the Consolidated Interest Expense of such Person and
its Restricted Subsidiaries for such period, to the extent that such
Consolidated Interest Expense was deducted in computing such
Consolidated Net Income; plus
(4) depreciation, amortization (including amortization of
goodwill and other intangibles and amortization of product development
expenditures, but excluding amortization of prepaid cash expenses that
were paid in a prior period) and other non-cash expenses (excluding any
such non-cash expense to the extent that it represents an accrual of or
reserve for cash expenses in any future period or amortization of a
prepaid cash expense that was paid in a prior period) of such Person
and its Restricted Subsidiaries for such period to the extent that such
depreciation, amortization and other non-cash expenses were deducted in
computing such Consolidated Net Income; plus
(5) the non-recurring charge of $2.8 million for the
year ended December 31, 2002 associated with the Company's management
incentive plan and the non-recurring restructuring charge in an amount
not to exceed $2.0 million for the year ended December 31, 2003
associated with the Company's warehousing, customer service and order
fulfillment functions; plus
(6) any expenses incurred or charges taken in connection
with (a) the issuance of Notes on the date of this Indenture and the
use of proceeds therefrom, (b) borrowings under the Term Loan Agreement
on the date of this Indenture and (c) the execution and delivery of the
Revolving Credit Agreement on the date of this Indenture; plus
(7) an amount equal to any gains or losses realized in
connection with foreign currency exchange transactions; minus
(8) non-cash items increasing such Consolidated Net
Income for such period, other than the accrual of revenue in the
ordinary course of business and other than the reversal of any non-cash
expense to the extent that it represented an accrual of or reserve for
cash expenses in any future period;
in each case, on a consolidated basis and determined in accordance with
GAAP.
Notwithstanding the preceding, the provision for taxes based on the
income or profits of, and the depreciation and amortization and other non-cash
expenses of, a Restricted Subsidiary of the Company will be added to
Consolidated Net Income to compute Consolidated Cash Flow of the Company only to
the extent that a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary
without prior governmental approval (that has not been obtained), and without
direct or indirect restriction pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to that Restricted Subsidiary or its
stockholders.
"Consolidated Indebtedness" means, with respect to any specified Person
as of any date of determination, the sum, without duplication, of:
5
(1) the total amount of Indebtedness of such Person and
its Restricted Subsidiaries; plus
(2) the total amount of Indebtedness of any other Person,
to the extent that such Indebtedness has been Guaranteed by the
referent Person or one or more of its Restricted Subsidiaries; plus
(3) the aggregate liquidation value of all Disqualified
Stock of such Person and any of its Restricted Subsidiaries that have
Guaranteed the Indebtedness of such Person and all preferred stock of
the Restricted Subsidiaries of such Person,
in each case, on a consolidated basis and determined in accordance with
GAAP.
"Consolidated Interest Expense" means, with respect to any specified
Person for any period, the sum, without duplication, of:
(1) the consolidated interest expense of such Person and
its Restricted Subsidiaries for such period, whether paid or accrued,
including, without limitation, amortization of debt issuance costs and
original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, imputed
interest with respect to Attributable Debt, commissions, discounts and
other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net of the effect of all payments
made or received pursuant to Hedging Obligations in respect of interest
rates; plus
(2) the consolidated interest expense of such Person and
its Restricted Subsidiaries that was capitalized during such period;
plus
(3) any interest expense on Indebtedness of another
Person that is Guaranteed by such Person or one of its Restricted
Subsidiaries or secured by a Lien on assets of such Person or one of
its Restricted Subsidiaries, whether or not such Guarantee or Lien is
called upon; plus
(4) the product of (a) all dividends, whether paid or
accrued and whether or not in cash, on any series of preferred stock of
such Person or any of its Restricted Subsidiaries, other than dividends
on Equity Interests payable solely in Equity Interests of the Company
(other than Disqualified Stock) or to the Company or a Restricted
Subsidiary of the Company, times (b) a fraction, the numerator of which
is one and the denominator of which is one minus the then current
combined federal, state and local statutory tax rate of such Person,
expressed as a decimal, in each case, on a consolidated basis and in
accordance with GAAP.
"Consolidated Net Income" means, with respect to any specified 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; provided that:
(1) the Net Income (but not loss) of any Person that is
not a Restricted Subsidiary or that is accounted for by the equity
method of accounting will be included only to the extent of the amount
of dividends or similar distributions paid in cash to the specified
Person or a Restricted Subsidiary of the Person;
(2) the Net Income of any Restricted Subsidiary will be
excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of
6
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;
(3) the cumulative effect of a change in accounting
principles will be excluded;
(4) notwithstanding clause (1) above, the Net Income of
any Unrestricted Subsidiary will be excluded, whether or not
distributed to the specified Person or one of its Subsidiaries; and
(5) any non-cash restructuring or non-cash extraordinary
charges taken by the specified Person or its Restricted Subsidiaries
will be added to Net Income in calculating Consolidated Net Income.
"Consolidated Secured Indebtedness" means, with respect to any
specified Person as of any date of determination, the sum, without duplication,
of:
(1) the total amount of Secured Indebtedness of such
Person and its Restricted Subsidiaries; plus
(2) the total amount of Secured Indebtedness of any other
Person, to the extent that such Indebtedness has been Guaranteed by the
referent Person or one or more of its Restricted Subsidiaries,
in each case, on a consolidated basis and determined in accordance with
GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who:
(1) was a member of such Board of Directors on the date
of this Indenture;
(2) was nominated for election or elected to such Board
of Directors with the approval of a majority of the Continuing
Directors who were members of such Board at the time of such nomination
or election; or
(3) was nominated by any Principal or Related Party.
"Corporate Trust office of the Trustee" will be at the address of the
Trustee specified in Section 12.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Credit Facilities" means, one or more debt facilities (including,
without limitation, the Term Loan Agreement and the Revolving Credit Agreement)
or commercial paper facilities, in each case with banks or other institutional
lenders providing for revolving credit loans, term loans, receivables financing
(including through the sale of receivables to such lenders or to special purpose
entities formed to borrow from such lenders against such receivables) or letters
of credit, in each case, as amended, restated, modified, renewed, refunded,
replaced or refinanced (including by means of sales of debt securities to
institutional investors) in whole or in part from time to time, whether with the
original agents and lenders or other agents and lenders or otherwise and whether
provided under the original debt or commercial paper facility or otherwise.
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"Custodian" means the Trustee, as custodian with respect to the
Notes in global form, or any successor entity thereto.
"Debt to Cash Flow Ratio" means, with respect to any specified
Person as of any date of determination, the ratio of (a) the Consolidated
Indebtedness of such Person as of such date to (b) the Consolidated Cash Flow of
such Person for the four most recently ended full fiscal quarters for which
internal financial statements are available immediately prior to such date of
determination, determined on a pro forma basis after giving effect to all
acquisitions or dispositions of assets made by such Person and its Restricted
Subsidiaries from the beginning of such four-quarter period through and
including such date of determination (including any related financing
transactions) as if such acquisitions and dispositions (and related financing
transactions) had occurred at the beginning of such four-quarter period.
In addition, for purposes of calculating the Debt to Cash Flow Ratio:
(1) acquisitions that have been made by the specified
Person or any of its Restricted Subsidiaries, including through mergers
or consolidations, or any Person or any of its Restricted Subsidiaries
acquired by the specified Person or any of its Restricted Subsidiaries,
and including any related financing transactions and including
increases in ownership of Restricted Subsidiaries, during the
four-quarter reference period or subsequent to such reference period
and on or prior to the date on which the event for which the
calculation of the Debt to Cash Flow Ratio is made (the "Calculation
Date") will be given pro forma effect (in accordance with Regulation
S-X under the Securities Act) as if they had occurred on the first day
of the four-quarter reference period and Consolidated Cash Flow for
such reference period shall be calculated without giving effect to
clause (3) of the proviso set forth in the definition of Consolidated
Net Income (it being understood that the accounting principles of the
specified Person shall be applied to any such acquired Person as if
those accounting principles had been applied since the first day of the
four-quarter reference period);
(2) the Consolidated Cash Flow attributable to
discontinued operations, as determined in accordance with GAAP, and
operations or businesses (and ownership interests therein) disposed of
prior to the Calculation Date, will be excluded;
(3) the Consolidated Interest Expense attributable to
discontinued operations, as determined in accordance with GAAP, and
operations or businesses (and ownership interests therein) disposed of
prior to the Calculation Date, will be excluded, but only to the extent
that the obligations giving rise to such Consolidated Interest Expense
will not be obligations of the specified Person or any of its
Restricted Subsidiaries following the Calculation Date;
(4) any Person that is a Restricted Subsidiary on the
Calculation Date will be deemed to have been a Restricted Subsidiary at
all times during such four-quarter period;
(5) any Person that is not a Restricted Subsidiary on the
Calculation Date will be deemed not to have been a Restricted
Subsidiary at any time during such four-quarter period; and
(6) if any Indebtedness bears a floating rate of
interest, the interest expense on such Indebtedness will be calculated
as if the rate in effect on the Calculation Date had been the
applicable rate for the entire period (taking into account any Hedging
Obligation applicable to such Indebtedness if such Hedging Obligation
has a remaining term as at the Calculation Date in excess of 12
months).
8
"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 Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof,
substantially in the form of Exhibit A1 hereto except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"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, in each case at the option of the holder of the Capital Stock), 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 of the Capital Stock, in whole or in part, on or prior to the date that
is 91 days after the date on which the Notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders of the Capital Stock have the right to require the
Company to repurchase such Capital Stock upon the occurrence of a change of
control or an asset sale will not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies Section 4.07 hereof. The amount of Disqualified Stock deemed
to be outstanding at any time for purposes of this Indenture will be the maximum
amount that the Company and its Restricted Subsidiaries may become obligated to
pay upon the maturity of, or pursuant to any mandatory redemption provisions of,
such Disqualified Stock, exclusive of accrued dividends.
"Domestic Subsidiary" means any Restricted Subsidiary of the Company
that was formed under the laws of the United States or any state of the United
States or the District of Columbia or that guarantees or otherwise provides
direct credit support for any Indebtedness of the Company.
"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).
"Equity Offering" means any issuance or sale of Equity Interests (other
than Disqualified Stock) of the Company or Parent.
"Euroclear" means Euroclear Bank, S.A./N.V., as operator of the
Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Notes issued in the Exchange Offer pursuant
to Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
9
"Existing Indebtedness" means Indebtedness of the Company and its
Subsidiaries (other than Indebtedness under the Term Loan Agreement or under the
Revolving Credit Agreement) in existence on the date of this Indenture, until
such amounts are repaid.
"Fair Market Value" means the value that would be paid by a willing
buyer to an unaffiliated willing seller in a transaction not involving distress
or necessity of either party, determined in good faith by the Board of Directors
of the Company (unless otherwise provided in this Indenture).
"Foreign Subsidiary" means any Restricted Subsidiary that is not a
Domestic Subsidiary.
"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 from time to time.
"Global Note Legend" means the legend set forth in Section 2.06(g)(2),
which is required to be placed on all Global Notes issued under this Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes deposited with or on
behalf of and registered in the name of the Depositary or its nominee,
substantially in the form of Exhibit A 1 hereto and that bears the Global Note
Legend and that has the "Schedule of Exchanges of Interests in the Global Note"
attached thereto, issued in accordance with Section 2.01, 2.06(b)(3),
2.06(b)(4), 2.06(d)(2) or 2.06(f) hereof.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Guarantee" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness (whether arising by virtue of
partnership arrangements, or by agreements to keep-well, to purchase assets,
goods, securities or services, to take or pay or to maintain financial statement
conditions or otherwise).
"Guarantors" means each of:
(1) Parent;
(2) the Company's direct and indirect Domestic
Subsidiaries existing on the date of this Indenture; and
(3) any other Subsidiary of the Company that executes a
Note Guarantee in accordance with the provisions of this Indenture,
and their respective successors and assigns.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under:
10
(1) interest rate swap agreements (whether from fixed to
floating or from floating to fixed), interest rate cap agreements and
interest rate collar agreements;
(2) other agreements or arrangements designed to manage
interest rates or interest rate risk; and
(3) other agreements or arrangements designed to protect
such Person against fluctuations in currency exchange rates or
commodity prices.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means a Global Note substantially in the form of
Exhibit A1 hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of and registered in the name of the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold to Institutional Accredited
Investors.
"Immaterial Subsidiary" means, as of any date, any Restricted
Subsidiary whose total assets, as of that date, are less than $100,000 and whose
total revenues for the most recent 12-month period do not exceed $100,000;
provided that a Restricted Subsidiary will not be considered to be an Immaterial
Subsidiary if it, directly or indirectly, guarantees or otherwise provides
direct credit support for any Indebtedness of the Company.
"Indebtedness" means with respect to any specified Person, any
indebtedness of such Person (excluding accrued expenses and trade payables),
whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in
respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations or
Attributable Debt in respect of sale and leaseback transactions;
(5) representing the balance deferred and unpaid of the
purchase price of any property or services due more than six months
after such property is acquired or such services are completed; or
(6) representing any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of
credit, Attributable Debt and Hedging Obligations) would appear as a
liability upon a balance sheet of the specified Person prepared in
accordance with GAAP. In addition, the term "Indebtedness" includes all
Indebtedness of others secured by a Lien on any asset of the specified
Person (whether or not such Indebtedness is assumed by the specified
Person) and, to the extent not otherwise included, the Guarantee by the
specified Person of any Indebtedness of any other Person.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
11
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Initial Notes" means the first $140,000,000 aggregate principal amount
of Notes issued under this Indenture on the date hereof.
"Initial Purchasers" means Bear, Steams & Co. Inc., BNY Capital
Markets, Inc. and Xxxxxxxxx & Company, Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the forms
of loans (including Guarantees or other obligations), advances or capital
contributions (excluding commission, travel and similar 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. If the Company
or any Subsidiary of the Company sells or otherwise disposes of any Equity
Interests of any direct or indirect Subsidiary of the Company such that, after
giving effect to any such sale or disposition, such Person is no longer a
Subsidiary of the Company, the Company will be deemed to have made an Investment
on the date of any such sale or disposition equal to the Fair Market Value of
the Company's Investments in such Subsidiary that were not sold or disposed of
in an amount determined as provided in the final paragraph of Section 4.07
hereof. The acquisition by the Company or any Subsidiary of the Company of a
Person that holds an Investment in a third Person will be deemed to be an
Investment by the Company or such Subsidiary in such third Person in an amount
equal to the Fair Market Value of the Investments held by the acquired Person in
such third Person in an amount determined as provided in the final paragraph of
Section 4.07 hereof. Except as otherwise provided in this Indenture, the amount
of an Investment will be determined at the time the Investment is made and
without giving effect to subsequent changes in value.
"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 on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be prepared
by the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"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.
"Liquidated Damages" means all Liquidated Damages then owing pursuant
to the Registration Rights Agreement.
12
"Net Income" means, with respect to any specified 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:
(1) any gain (but not loss), together with any related
provision for taxes on such gain (but not loss), realized in connection
with: (a) any Asset Sale; or (b) the disposition of any securities 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
(2) any extraordinary gain (but not loss), together with
any related provision for taxes on such extraordinary gain (but not
loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company 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, and sales commissions, and any
relocation expenses incurred as a result of the Asset Sale, taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, and
amounts required to be applied to the repayment of Indebtedness, other than
Indebtedness under a Credit Facility, secured by a Lien on the asset or assets
that were the subject of such Asset Sale and any reserve for adjustment in
respect of the sale price of such asset or assets established in accordance with
GAAP.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company 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;
(2) no default with respect to which (including any
rights that the Holders of the Indebtedness 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 Company or any of its Restricted Subsidiaries to declare a
default on such other Indebtedness or cause the payment of the
Indebtedness to be accelerated or payable prior to its Stated Maturity;
and
(3) as to which the lenders have been notified in writing
that they will not have any recourse to the stock or assets of the
Company or any of its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Guarantee " means the Guarantee by each Guarantor of the
Company's payment obligations under this Indenture and on the Notes, executed
pursuant to the provisions of this Indenture.
"Notes" has the meaning assigned to it in the preamble to this
Indenture. The Initial Notes and the Additional Notes shall be treated as a
single class for all purposes under this Indenture, and unless the context
otherwise requires, all references to the Notes shall include the Initial Notes
and any Additional Notes.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
13
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Section 12.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Parent" means Haights Cross Communications, Inc., a Delaware
corporation.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Business" means the lines of business conducted by the
Company and its Subsidiaries on the date of this Indenture and any businesses
similar, related, incidental or ancillary thereto or that constitutes a
reasonable extension or expansion thereof.
"Permitted Investments" means:
(1) any Investment in the Company or in a Restricted
Subsidiary of the Company;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Restricted
Subsidiary of the Company in a Person, if as a result of such
Investment:
(a) such Person becomes a Restricted Subsidiary
of the Company; or
(b) 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
Company or a Restricted Subsidiary of the Company;
(4) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and
in compliance with Section 4.10 hereof;
(5) any acquisition of assets or Capital Stock solely in
exchange for the issuance of Equity Interests (other than Disqualified
Stock) of the Company;
(6) any Investments received in compromise or resolution
of (A) obligations of trade creditors or customers that were incurred
in the ordinary course of business of the Company or any of its
Restricted Subsidiaries, including pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency
of any trade creditor or customer; or (B) litigation, arbitration or
other disputes with Persons who are not Affiliates;
(7) Investments represented by Hedging Obligations;
14
(8) repurchases of the Notes; and
(9) other Investments in any Person engaged primarily in
a Permitted Business 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 (9) that are at the time
outstanding not to exceed $10.0 million.
"Permitted Liens" means
(1) Liens securing Indebtedness and other Obligations
that was incurred pursuant to clauses (1) or (12) of the definition of
Permitted Debt;
(2) Liens in favor of the Company or the Guarantors;
(3) 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;
(4) Liens existing on the date of this Indenture;
(5) 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 is required in conformity with GAAP has been made
therefor;
(6) Liens imposed by law, such as carriers',
warehousemen's, landlord's and mechanics' Liens, in each case, incurred
in the ordinary course of business;
(7) survey exceptions, easements or reservations of, or
rights of others for, licenses, rights-of-way, sewers, electric lines,
telegraph and telephone lines and other similar purposes, or zoning or
other restrictions as to the use of real property that were not
incurred in connection with Indebtedness and that do not in the
aggregate materially adversely affect the value of said properties or
materially impair their use in the operation of the business of such
Person;
(8) Liens created for the benefit of (or to secure) the
Notes (or the Note Guarantees);
(9) Liens to secure any Permitted Refinancing
Indebtedness permitted to be incurred under this Indenture; provided,
however, that:
(a) the new Lien shall be limited to all or part
of the same property and assets that secured or, under the
written agreements pursuant to which the original Lien arose,
could secure the original Lien (plus improvements and
accessions to, such property or proceeds or distributions
thereof); and
(b) the Indebtedness secured by the new Lien is
not increased to any amount greater than the sum of (x) the
outstanding principal amount or, if greater, committed amount,
of the Permitted Referencing Indebtedness and (y) an amount
necessary to pay any fees and expenses, including premiums,
related to such refinancings, refunding, extension, renewal or
replacement;
15
(10) Liens securing reimbursement obligations with respect
to commercial letters of credit that encumber documents and other
property relating to letters of credit and products and proceeds
thereof;
(11) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual or warranty, including
rights of offset and set-off;
(12) Liens securing Hedging Obligations, which Hedging
Obligations relate to Indebtedness that is otherwise permitted under
this Indenture;
(13) leases or subleases granted to others;
(14) Liens under licensing agreements;
(15) Liens arising from filing Uniform Commercial Code
financing statements regarding leases;
(16) judgment Liens not giving rise to an Event of
Default;
(17) Liens encumbering property of the Company or any of
its Restricted Subsidiaries incurred in the ordinary course of business
in connection with workers' compensation, unemployment insurance or
other forms of governmental insurance or benefits, or to secure
performance of bids, tenders, statutory obligations, leases and
contracts (other than for Indebtedness) entered into in the ordinary
course of business of the Company or any of its Restricted
Subsidiaries; and
(18) Liens securing other Indebtedness provided; that the
Secured Debt to Cash Flow Ratio for the Company's most recently ended
four full fiscal quarters for which internal financial statements are
available immediately preceding the date on which such Lien is created,
incurred or assumed or has been first suffered to exist would have been
no greater than 2.25 to 1, determined on a pro forma basis, as if the
Obligations secured by such Lien had been incurred at the beginning of
such four-quarter period.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to refund, refinance, replace, defease or discharge
other Indebtedness of the Company or any of its Restricted Subsidiaries (other
than intercompany Indebtedness); provided that:
(1) the principal amount (or accreted value, if
applicable) of such Permitted Refinancing Indebtedness does not exceed
the principal amount (or accreted value, if applicable) of the
Indebtedness extended, refinanced, renewed, replaced, defeased or
refunded (plus all accrued interest on the Indebtedness and the amount
of all expenses and premiums incurred in connection therewith);
(2) 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;
(3) if the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded is subordinated in right of
payment to the Notes, such Permitted Refinancing
16
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 of Notes as those contained in the
documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by the Company
or by the Restricted Subsidiary who is the obligor on the Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or other entity.
"Principals" means Media/Communications Partners III Limited
Partnership and M/C Investors L.L.C. and Great Hill Partners, LLC and its
related investment funds.
"Private Placement Legend" means the legend set forth in Section 2
..06(g)(1) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of August 20, 2003, among the Company, the Guarantors and
the other parties named on the signature pages thereof, as such agreement may be
amended, modified or supplemented from time to time and, with respect to any
Additional Notes, one or more registration rights agreements among the Company,
the Guarantors and the other parties thereto, as such agreement(s) may be
amended, modified or supplemented from time to time, relating to rights given by
the Company to the purchasers of Additional Notes to register such Additional
Notes under the Securities Act.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note
or Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent Global Note in
the form of Exhibit Al hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary Global Note in
the form of Exhibit A2 hereto deposited with or on behalf of and registered in
the name of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Notes initially sold in reliance on Rule 903
of Regulation S.
"Related Party" means
(1) any controlling stockholder, 80% (or more) owned
Subsidiary, or immediate family member (in the case of an individual)
of any Principal;
(2) any trust, corporation, partnership or other entity,
the beneficiaries, stockholders, partners, owners or Persons
beneficially holding an 80% or more controlling interest of which
17
consist of any one or more Principals and/or such other Persons
referred to in the immediately preceding clause (1);or
(3) any trust, corporation, partnership or other entity,
the general partner of which is controlled, directly or indirectly, by
Persons who, directly or indirectly, are general partners of a
Principal.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration 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 Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day distribution compliance period as
defined in Regulation S.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Revolving Credit Agreement" means that certain Revolving Credit
Agreement, dated as of the date hereof, by and among the Company and the
financial institutions party thereto, providing for revolving credit borrowings,
including any related notes, guarantees, collateral documents, instruments and
agreements executed in connection therewith, and in each case as amended,
restated, modified, renewed, refunded, replaced (whether upon or after
termination or otherwise) or refinanced (including by means of sales of debt
securities to institutional investors) in whole or in part from time to time,
whether with the original agents and lenders or other agents and lenders or
otherwise, whether provided under the original Revolving Credit Agreement or
otherwise and whether the Company or an Affiliate of the Company is the
borrower.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Secured Debt to Cash Flow Ratio" means, with respect to any specified
Person as of any date of determination, the ratio of (a) the Consolidated
Secured Indebtedness of such Person as of such date to (b) the Consolidated Cash
Flow of such Person for the four most recently ended full fiscal quarters for
which internal financial statements are available immediately prior to such date
of determination, determined on a pro forma basis after giving effect to all
acquisitions or dispositions of assets made by such Person and its Restricted
Subsidiaries from the beginning of such four-quarter period through and
including such date
18
of determination (including any related financing transactions) as if such
acquisitions and dispositions (and related financing transactions) had occurred
at the beginning of such four-quarter period.
In addition, for purposes of calculating the Secured Debt to Cash Flow
Ratio:
(1) acquisitions that have been made by the specified
Person or any of its Restricted Subsidiaries, including through mergers
or consolidations, or any Person or any of its Restricted Subsidiaries
acquired by the specified Person or any of its Restricted Subsidiaries,
and including any related financing transactions and including
increases in ownership of Restricted Subsidiaries, during the
four-quarter reference period or subsequent to such reference period
and on or prior to the date on which the event for which the
calculation of the Secured Debt to Cash Flow Ratio is made (the
"Secured Debt Calculation Date") will be given pro forma effect (in
accordance with Regulation S-X under the Securities Act) as if they had
occurred on the first day of the four-quarter reference period and
Consolidated Cash Flow for such reference period shall be calculated
without giving effect to clause (3) of the proviso set forth in the
definition of Consolidated Net Income (it being understood that the
accounting principles of the specified Person shall be applied to any
such acquired Person as if those accounting principles had been applied
since the first day of the four-quarter reference period);
(2) the Consolidated Cash Flow attributable to
discontinued operations, as determined in accordance with GAAP, and
operations or businesses (and ownership interests therein) disposed of
prior to the Secured Debt Calculation Date, will be excluded;
(3) the Consolidated Interest Expense attributable to
discontinued operations, as determined in accordance with GAAP, and
operations or businesses (and ownership interests therein) disposed of
prior to the Secured Debt Calculation Date, will be excluded, but only
to the extent that the obligations giving rise to such Consolidated
Interest Expense will not be obligations of the specified Person or any
of its Restricted Subsidiaries following the Secured Debt Calculation
Date;
(4) any Person that is a Restricted Subsidiary on the
Secured Debt Calculation Date will be deemed to have been a Restricted
Subsidiary at all times during such four-quarter period;
(5) any Person that is not a Restricted Subsidiary on the
Secured Debt Calculation Date will be deemed not to have been a
Restricted Subsidiary at any time during such four- quarter period; and
(6) if any Indebtedness bears a floating rate of
interest, the interest expense on such Indebtedness will be calculated
as if the rate in effect on the Secured Debt Calculation Date had been
the applicable rate for the entire period (taking into account any
Hedging Obligation applicable to such Indebtedness if such Hedging
Obligation has a remaining term as at the Secured Debt Calculation Date
in excess of 12 months).
"Secured Indebtedness" means, with respect to any specified Person, any
Indebtedness of such Person that is secured by a Lien on the assets of such
Person, plus any Indebtedness of any other Person to the extent that such
Indebtedness is secured by a Lien on the assets of the specified Person.
"Securities Act" means the Securities Act of 1933, as amended.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in the Registration Rights Agreement.
19
"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 or
principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness as of the date of this Indenture, and will not include any
contingent obligations to repay, redeem or repurchase any such interest or
principal prior to the date originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any specified Person:
(1) 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 and
after giving effect to any voting agreement or stockholders' agreement
that effectively transfers voting power) to vote in the election of
directors, managers or trustees of the corporation, association or
other business entity is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of
that Person (or a combination thereof); and
(2) 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 that Person
or one or more Subsidiaries of that Person (or any combination
thereof).
"Term Loan Agreement" means that certain Term Loan Agreement, dated as
of the date hereof, by and among the Company and the financial institutions
party thereto, providing for term loan borrowings, including any related notes,
guarantees, collateral documents, instruments and agreements executed in
connection therewith, and in each case as amended, restated, modified, renewed,
refunded, replaced (whether upon or after termination or otherwise) or
refinanced (including by means of sales of debt securities to institutional
investors) in whole or in part from time to time, whether with the original
agents and lenders or other agents and lenders or otherwise, whether provided
under the original Term Loan Agreement or otherwise and whether the Company or
an Affiliate of the Company is the borrower.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
thereunder.
"Trustee" means the party named as such in the preamble to this
Indenture until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.
"Unrestricted Global Note" means a Global Note that does not bear and
is not required to bear the Private Placement Legend.
"Unrestricted Definitive Note" means a Definitive Note that does not
bear and is not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a
Board Resolution, but only to the extent that such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
20
(2) except as permitted by Section 4.11 hereof, is not
party to any agreement, contract, arrangement or understanding with the
Company or any Restricted Subsidiary of the Company unless the terms of
any such agreement, contract, arrangement or understanding are no less
favorable the Company or such Restricted Subsidiary than those that
might be obtained at the time from Persons who are not Affiliates of
the Company;
(3) is a Person with respect to which neither the Company
nor any of its Restricted Subsidiaries has any direct or indirect
obligation (a) to subscribe for additional Equity Interests or (b) to
maintain or preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results; and
(4) has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the Company
or any of its Restricted Subsidiaries.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary will be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
preceding conditions and was permitted by Section 4.07 hereof. If, at any time,
any Unrestricted Subsidiary would fail to meet the preceding requirements as an
Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09 hereof, the Company will be in
default of such section. The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation will be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation will only be permitted if (1) such
Indebtedness is permitted under Section 4.09 hereof, calculated on a pro forma
basis as if such designation had occurred at the beginning of the four-quarter
reference period; and (2) no Default or Event of Default would be in existence
following such designation.
"US. Person" means a U.S. Person as defined in Rule 902(k) promulgated
under the Securities Act.
"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:
(1) the sum of the products obtained by multiplying (a)
the amount of each then o remaining installment, sinking fund, serial
maturity or other required payments of principal, including payment at
final maturity, in respect of the Indebtedness, 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
(2) the then outstanding principal amount of such
Indebtedness.
Section 1.02 Other Definitions.
21
TERM Defined in Section
---- ------------------
"Affiliate Transaction"................................. 4.11
"Asset Sale Offer"...................................... 3.09
"Authentication Order".................................. 2.02
"Change of Control Offer"............................... 4.15
"Change of Control Payment"............................. 4.15
"Change of Control Payment Date"........................ 4.15
"Covenant Defeasance"................................... 8.03
"DTC"................................................... 2.03
"Event of Default"...................................... 6.01
"Excess Proceeds"....................................... 4.10
"incur"................................................. 4.09
"Legal Defeasance"...................................... 8.02
"Offer Amount".......................................... 3.09
"Offer Period".......................................... 3.09
"Parent Indenture"...................................... 4.07
"Paying Agent".......................................... 2.03
"Payment Default"....................................... 6.01
"Permitted Debt"........................................ 4.09
"Purchase Date"......................................... 3.09
"Registrar"............................................. 2.03
"Restricted Payments"................................... 4.07
"Tax 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 and the Note Guarantees means the Company and
the Guarantors, respectively, and any successor obligor upon the Notes and the
Note Guarantees, respectively.
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;
22
(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) "will" shall be interpreted to express a command;
(6) provisions apply to successive events and
transactions; and
(7) references to sections of or rules under the
Securities Act will 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 will be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Note will be dated the date of its authentication. The Notes
shall be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes will constitute, and
are hereby expressly made, a part of this Indenture and the Company, the
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.
(b) Global Notes. Notes issued in global form will be
substantially in the form of Exhibits Al or A2 attached hereto (including the
Global Note Legend thereon and the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Notes issued in definitive form will be
substantially in the form of Exhibit Al attached hereto (but without the Global
Note Legend thereon and without the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Each Global Note will represent such of the
outstanding Notes as will be specified therein and each shall provide that it
represents 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 will be made by the
Trustee or the Custodian, at the direction of the Trustee, in accordance with
instructions given by the Holder thereof as required by Section 2.06 hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance on
Regulation S will be issued initially in the form of the Regulation S Temporary
Global Note, which will be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, at its New York office, as custodian for
the Depositary, and registered in the name of the Depositary or the nominee of
the Depositary for the accounts of designated agents holding on behalf of
Euroclear or Clearstream, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The Restricted Period will be terminated upon
the receipt by the Trustee of:
23
(1) a written certificate from the Depositary, together
with copies of certificates from Euroclear and Clearstream certifying
that they have received certification of non-United States beneficial
ownership of 100% of the aggregate principal amount of the Regulation S
Temporary Global Note (except to the extent of any beneficial owners
thereof who acquired an interest therein during the Restricted Period
pursuant to another exemption from registration under the Securities
Act and who will take delivery of a beneficial ownership interest in a
144A Global Note or an IAI Global Note bearing a Private Placement
Legend, all as contemplated by Section 2.06(b) hereof); and
(2) an Officers' Certificate from the Company.
Following the termination of the Restricted Period, beneficial
interests in the Regulation S Temporary Global Note will be exchanged
for beneficial interests in Regulation S Permanent Global Note pursuant
to the Applicable Procedures. Simultaneously with the authentication of
Regulation S Permanent Global Notes, the Trustee will cancel the
Regulation S Temporary Global Note. The aggregate principal amount of
the Regulation S Temporary Global Notes and the Regulation S Permanent
Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or
its nominee, as the case may be, in connection with transfers of
interest as hereinafter provided.
(3) Euroclear and Clearstream Procedures Applicable. The
provisions of the "Operating Procedures of the Euroclear System" and
"Terms and Conditions Governing Use of Euroclear" and the "General
Terms and Conditions of Clearstream Banking" and "Customer Handbook" of
Clearstream will be applicable to transfers of beneficial interests in
the Regulation S Temporary Global Notes and the Regulation S Permanent
Global Notes that are held by Participants through Euroclear or
Clearsteam.
Section 2.02 Execution and Authentication.
At least one Officer must sign the Notes for the Company 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 will nevertheless be valid.
A Note will not be valid until authenticated by the manual signature of
the Trustee. The signature will be conclusive evidence that the Note has been
authenticated under this Indenture.
The Trustee will, upon receipt of a written order of the Company signed
by at least one Officer (an "Authentication Order"), authenticate Notes for
original issue.
The Trustee may appoint an authenticating agent acceptable to the
Company 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 by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
Section 2.03 Registrar and Paying Agent.
The Company will 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 will keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term
24
"Registrar" includes any co-registrar and the term "Paying Agent" includes any
additional paying agent. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company will notify the Trustee in writing of
the name and address of any Agent not a party to this Indenture. If the Company
fails to appoint or maintain another entity as Registrar or Paying Agent, the
Trustee shall act as such. The Company or any of its Subsidiaries may act as
Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC') to
act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04 Paying Agent to Hold Money in Trust.
The Company will require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will 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 Liquidated Damages, if any, or interest on the Notes, and
will notify the Trustee of any default by the Company in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a 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 Company or a
Subsidiary) will have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it will 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 Company, the
Trustee will serve as Paying Agent for the Notes.
Section 2.05 Holder Lists.
The Trustee will preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee
is not the Registrar, the Company will 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 of
Notes and the Company shall otherwise comply with TIA Section 312(a).
Section 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not
be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global Notes
will be exchanged by the Company for Definitive Notes if:
(1) the Company delivers to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under
the Exchange Act and, in either case, a successor Depositary is not
appointed by the Company within 120 days after the date of such notice
from the Depositary; or
(2) the Company in its sole discretion determines that
the Global Notes (in whole but not in part) should be exchanged for
Definitive Notes and delivers a written notice to such effect to the
Trustee; provided that in no event shall the Regulation S Temporary
Global Notes be
25
exchanged by the Company for Definitive Notes prior to (x) the
expiration of the Restricted Period and (y) the receipt by the
Registrar of any certificates required pursuant to Rule
903(b)(3)(ii)(B) under the Securities Act.
Upon the occurrence of either of the preceding events in (1) or (2)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note
authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof,
shall be authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as provided
in this Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global Notes
will be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes will be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
Transfers of beneficial interests in the Global Notes also will require
compliance with either subparagraph (1) or (2) below, as applicable, as well as
one or more of the other following subparagraphs, as applicable:
(1) Transfer of Beneficial Interests in the Same Global
Note. Beneficial interests in any Restricted Global Notes may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in the same Restricted Global Notes in accordance
with the transfer, restrictions set forth in the Private Placement
Legend; provided, however, that prior to the expiration of the
Restricted Period, transfers of beneficial interests in the Regulation
S Temporary Global Notes may not be made to a U.S. Person or for the
account or benefit of a U.S. Person (other than an Initial Purchaser).
Beneficial interests in any Unrestricted Global Note may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note. No written orders
or instructions shall be required to be delivered to the Registrar to
effect the transfers described in this Section 2.06(b)(1).
(2) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section
2.06(b)(1) above, the transferor of such beneficial interest must
deliver to the Registrar either:
(A) both:
(i) a written order from a Participant
or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing
the Depositary to credit or cause to be credited a
beneficial interest in another Global Note in an
amount equal to the beneficial interest to be
transferred or exchanged; and
(ii) instructions given in accordance
with the Applicable Procedures containing information
regarding the Participant account to be credited with
such increase; or
26
(B) both:
(i) a written order from a Participant
or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing
the Depositary to cause to be issued a Definitive
Note in an amount equal to the beneficial interest to
be transferred or exchanged; and
(ii) instructions given by the
Depositary to the Registrar containing information
regarding the Person in whose name such Definitive
Note shall be registered to effect the transfer or
exchange referred to in (1) above; provided that in
no event shall Definitive Notes be issued upon the
transfer or exchange of beneficial interests in the
Regulation S Temporary Global Notes prior to (A) the
expiration of the Restricted Period and (B) the
receipt by the Registrar of any certificates required
pursuant to Rule 903 under the Securities Act. Upon
consummation of an Exchange Offer by the Company in
accordance with Section 2.06(f) hereof, the
requirements of this Section 2.06(b)(2) shall be
deemed to have been satisfied upon receipt by the
Registrar of the instructions contained in the Letter
of Transmittal delivered by the Holder of such
beneficial interests in the Restricted Global Notes.
Upon satisfaction of all of the requirements for
transfer or exchange of beneficial interests in
Global Notes contained in this Indenture and the
Notes or otherwise applicable under the Securities
Act, the Trustee shall adjust the principal amount of
the relevant Global Note(s) pursuant to Section
2.06(h) hereof.
(3) Transfer of Beneficial Interests to Another
Restricted Global Note. A beneficial interest in any Restricted Global
Note may be transferred to a Person who takes delivery thereof in the
form of a beneficial interest in another Restricted Global Note if the
transfer complies with the requirements of Section 2.06(b)(2) above and
the Registrar receives the following:
(A) if the transferee will take delivery in the
form of a beneficial interest in the 144A Global Note, then
the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (1)
thereof;
(B) if the transferee will take delivery in the
form of a beneficial interest in the Regulation S Temporary
Global Notes or the Regulation S Global Notes, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof; and
(C) if the transferee will take delivery in the
form of a beneficial interest in the IAI Global Notes, then
the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3) thereof, if
applicable.
(4) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in an Unrestricted
Global Note. A beneficial interest in any Restricted Global Notes may
be exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note if the exchange or transfer complies with the requirements of
Section 2.06(b)(2) above and:
27
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the holder of the beneficial
interest to be transferred, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the distribution
of the Exchange Notes or (iii) a Person who is an affiliate
(as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for a beneficial
interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a)
thereof; or
(ii) if the holder of such beneficial
interest in a Restricted Global Note proposes to
transfer such beneficial interest to a Person who
shall take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive
Notes.
(1) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. If any holder of a beneficial interest
in a Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note or to transfer such
beneficial interest to a Person who takes delivery thereof in the form
of a Restricted Definitive Note, then, upon receipt by the Registrar of
the following documentation:
28
(A) if the holder of such beneficial interest in
a Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such beneficial interest is being
transferred to a Non-U.S. Person in an offshore transaction
in accordance with Rule 903 or Rule 904, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such beneficial interest is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of
the Securities Act other than those listed in subparagraphs
(B) through (D) above, a certificate to the effect set forth
in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable;
(F) if such beneficial interest is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(G) if such beneficial interest is being
transferred pursuant to an effective registration statement
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(1) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(2) Beneficial Interests in Regulation S Temporary Global
Note to Definitive Notes. Notwithstanding Sections 2.06(c)(1)(A) and
(C) hereof, a beneficial interest in the Regulation S Temporary Global
Note may not be exchanged for a Definitive Note or transferred to a
Person who takes delivery thereof in the form of a Definitive Note
prior to (A) the expiration of the Restricted Period and (B) the
receipt by the Registrar of any certificates required pursuant to Rule
903(b)(3)(ii)(B) under the Securities Act, except in the case of a
transfer pursuant to an
29
exemption from the registration requirements of the Securities Act
other than Rule 903 or Rule 904.
(3) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the holder of such
beneficial interest, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the distribution
of the Exchange Notes or (iii) a Person who is an affiliate
(as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for an Unrestricted
Definitive Note, a certificate from such holder in
the form of Exhibit C hereto, including the
certifications in item (1)(b) thereof; or
(ii) if the holder of such beneficial
interest in a Restricted Global Note proposes to
transfer such beneficial interest to a Person who
shall take delivery thereof in the form of an
Unrestricted Definitive Note, a certificate from such
holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(4) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest
in an Unrestricted Global Note proposes to exchange such beneficial
interest for a Definitive Note or to transfer such beneficial interest
to a Person who takes delivery thereof in the form of a Definitive
Note, then, upon satisfaction of the conditions set forth in Section
2.06(b)(2) hereof, the Trustee will cause the aggregate principal
amount of the applicable Global Note to be reduced accordingly pursuant
to Section 2.06(h) hereof, and the Company will execute and the Trustee
will authenticate and deliver to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest pursuant
to this Section 2.06(c)(4) will be registered in such name or names and
in such authorized denomination or denominations
30
as the holder of such beneficial interest requests through instructions
to the Registrar from or through the Depositary and the Participant or
Indirect Participant. The Trustee will deliver such Definitive Notes to
the Persons in whose names such Notes are so registered. Any Definitive
Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(4) will not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(1) Restricted Definitive Notes to Beneficial Interests
in Restricted Global Notes. If any Holder of a Restricted Definitive
Note proposes to exchange such Note for a beneficial interest in a
Restricted Global Note or to transfer such Restricted Definitive Notes
to a Person who takes delivery thereof in the form of a beneficial
interest in a Restricted Global Note, then, upon receipt by the
Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive
Note proposes to exchange such Note for a beneficial interest
in a Restricted Global Note, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications in
item (2)(b) thereof;
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of
the Securities Act other than those listed in subparagraphs
(B) through (D) above, a certificate to the effect set forth
in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable;
(F) if such Restricted Definitive Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being
transferred pursuant to an effective registration statement
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (3)(c) thereof,
the Trustee will cancel the Restricted Definitive Note,
increase or cause to be increased the aggregate principal
amount of, in the case of clause (A) above, the appropriate
Restricted Global Note, in the case of clause (B) above, the
144A Global Note, in the case of clause (C) above, the
Regulation S Global Note, and in all other cases, the IAI
Global Note.
31
(2) Restricted Definitive Notes to Beneficial Interests
in Unrestricted Global Notes. A Holder of a Restricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Restricted Definitive Note to a Person who
takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the Holder, in the case of
an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is
not (i) a Broker-Dealer, (ii) a Person participating in the
distribution of the Exchange Notes or (iii) a Person who is an
affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the Holder of such Definitive
Notes proposes to exchange such Notes for a
beneficial interest in the Unrestricted Global Note,
a certificate from such Holder in the form of Exhibit
C hereto, including the certifications in item (l)(c)
thereof; or
(ii) if the Holder of such Definitive
Notes proposes to transfer such Notes to a Person who
shall take delivery thereof in the form of a
beneficial interest in the Unrestricted Global Note,
a certificate from such Holder in the form of Exhibit
B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.06(d)(2), the Trustee will cancel the
Definitive Notes and increase or cause to be increased the aggregate
principal amount of the Unrestricted Global Note.
(3) Unrestricted Definitive Notes to Beneficial Interests
in Unrestricted Global Notes. A Holder of an Unrestricted Definitive
Note may exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Definitive Notes to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note at any time. Upon receipt of a request for
such an exchange or transfer, the Trustee will cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased the
aggregate principal amount of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (2)(B),
(2)(D) or (3) above at a time when an Unrestricted Global Note
32
has not yet been issued, the Company will issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the
Trustee will authenticate one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of Definitive
Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's compliance
with the provisions of this Section 2.06(e), the Registrar will register the
transfer or exchange of Definitive Notes. Prior to such registration of
transfer or exchange, the requesting Holder must present or surrender to the
Registrar the Definitive Notes duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by its attorney, duly authorized in writing. In addition, the
requesting Holder must provide any additional certifications, documents and
information, as applicable, required pursuant to the following provisions of
this Section 2.06(e).
(1) Restricted Definitive Notes to Restricted Definitive
Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in the form
of a Restricted Definitive Note if the Registrar receives the
following:
(A) if the transfer will be made pursuant to
Rule 144A, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications in
item (1) thereof;
(B) if the transfer will be made pursuant to
Rule 903 or Rule 904, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transfer will be made pursuant to any
other exemption from the registration requirements of the
Securities Act, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable.
(2) Restricted Definitive Notes to Unrestricted
Definitive Notes. Any Restricted Definitive Note may be exchanged by
the Holder thereof for an Unrestricted Definitive Note or transferred
to a Person or Persons who take delivery thereof in the form of an
Unrestricted Definitive Note if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the Holder, in the case of
an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is
not (i) a broker-dealer, (ii) a Person participating in the
distribution of the Exchange Notes or (iii) a Person who is an
affiliate (as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to
the Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) any such transfer is effected by a Broker-
Dealer pursuant to the Exchange Offer Registration Statement
in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
33
(i) if the Holder of such Restricted
Definitive Notes proposes to exchange such Notes for
an Unrestricted Definitive Note, a certificate from
such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(d) thereof;
or
(ii) if the Holder of such Restricted
Definitive Notes proposes to transfer such Notes to a
Person who shall take delivery thereof in the form of
an Unrestricted Definitive Note, a certificate from
such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that such
exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
(3) Unrestricted Definitive Notes to Unrestricted
Definitive Notes. A Holder of Unrestricted Definitive Notes may
transfer such Notes to a Person who takes delivery thereof in the form
of an Unrestricted Definitive Note. Upon receipt of a request to
register such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company will issue and,
upon receipt of an Authentication Order in accordance with Section 2.02 hereof,
the Trustee will authenticate:
(1) one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes accepted for exchange in the
Exchange Offer by Persons that certify in the applicable Letters of
Transmittal that (A) they are not Broker-Dealers, (B) they are not
participating in a distribution of the Exchange Notes and (z) they are
not affiliates (as defined in Rule 144) of the Company; and
(2) Unrestricted Definitive Notes in an aggregate
principal amount equal to the principal amount of the Restricted
Definitive Notes accepted for exchange in the Exchange Offer by Persons
who made the foregoing certification.
Concurrently with the issuance of such Notes, the Trustee will cause
the aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company will execute and the Trustee will
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Unrestricted Definitive Notes in the appropriate principal
amount.
(g) Legends. The following legends will appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(1) Private Placement Legend.
(A) Except as permitted by subparagraph (B)
below, each Global Note and each Definitive Note (and all
Notes issued in exchange therefor or substitution thereof)
shall bear the legend in substantially the following form
34
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE
BENEFIT OF THE ISSUER THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY (1) (a) IN THE UNITED STATES TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (b) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH RULE 904 UNDER THE SECURITIES ACT, (c) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (d) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (a) (1), (2), (3) OR (7) OF THE
SECURITIES ACT (AN "INSTITUTIONAL ACCREDITED INVESTOR")) THAT, PRIOR TO SUCH
TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF
NOTES LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT
SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT OR (e) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND
BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY
OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE."
(B) Notwithstanding the foregoing, any Global
Note or Definitive Note issued pursuant to subparagraphs
(b)(4), (c)(3), (c)(4), (d)(2), (d)(3), (e)(2), (e)(3) or (f)
of this Section 2.06 (and all Notes issued in exchange
therefor or substitution thereof) will not bear the Private
Placement Legend.
(2) Global Note Legend. Each Global Note will bear a
legend in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (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 (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR
DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
35
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("XXX"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
(h) Cancellation and/or Adjustment of Global Notes. At such time
as all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note will be returned to or
retained and canceled 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 or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note will be
reduced accordingly and an endorsement will be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note will be increased accordingly and
an endorsement will be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(1) To permit registrations of transfers and exchanges,
the Company will execute and the Trustee will authenticate Global Notes
and Definitive Notes upon receipt of an Authentication Order in
accordance with Section 2.02 hereof or at the Registrar's request.
(2) No service charge will be made to a Holder of a
beneficial interest in a Global Note or to a Holder of a Definitive
Note for any registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than
any such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 2.10, 3.06, 3.09, 4.10, 4.15
and 9.05 hereof).
(3) The Registrar will not be required to register the
transfer of or exchange of any Note selected for redemption in whole or
in part, except the unredeemed portion of any Note being redeemed in
part.
(4) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes will be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the
Global Notes or Definitive Notes surrendered upon such registration of
transfer or exchange.
36
(5) Neither the Registrar nor the Company will be
required:
(A) to issue, to register the transfer of or to
exchange any Notes during a period beginning at the opening of
business 15 days before the day of any selection of Notes for
redemption under Section 3.02 hereof and ending at the close
of business on the day of selection;
(B) to register the transfer of or to exchange
any Note selected for redemption in whole or in part, except
the unredeemed portion of any Note being redeemed in part; or
(C) to register the transfer of or to exchange a
Note between a record date and the next succeeding interest
payment date.
(6) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company 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, and
none of the Trustee, any Agent or the Company shall be affected by
notice to the contrary.
(7) The Trustee will authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.02
hereof.
(8) 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.
Section 2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company will issue and the Trustee, upon receipt of an
Authentication Order, will authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and
will 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 canceled 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 2.08 as not outstanding. Except as set forth in Section 2.09 hereof, a
Note does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note; however, Notes held by the Company or a Subsidiary of
the Company shall not be deemed to be outstanding for purposes of Section 3.07
(a) hereof.
37
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 protected 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 Company, 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 will be deemed to be no longer outstanding and will 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
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, will be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee will be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned will be so disregarded.
Section 2.10 Temporary Notes.
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
will authenticate temporary Notes. Temporary Notes will be substantially in the
form of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as may be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company will prepare and the Trustee
will authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes will be entitled to all of the benefits of
this Indenture.
Section 2.11 Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent will forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else will cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and will destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Notes will be delivered
to the Company. The Company 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 Company defaults in a payment of interest on the Notes, it will
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 Company will 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 Company will fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
may 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 Company (or,
upon the written request of the Company, the Trustee in the
38
name and at the expense of the Company) will 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.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it must furnish to the Trustee,
at least 30 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth:
(1) the clause of this Indenture pursuant to which the
redemption shall occur;
(2) the redemption date;
(3) the principal amount of Notes to be redeemed; and
(4) the redemption price.
Section 3.02 Selection of Notes to Be Redeemed or Purchased.
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee will select Notes for redemption or
purchase as follows:
(1) if the Notes are listed on any national securities
exchange, in compliance with the requirements of the principal national
securities exchange on which the Notes are listed; or
(2) if the Notes are not listed on any national
securities exchange, on a pro rata basis, by lot or by such method as
the Trustee shall deem fair and appropriate.
In the event of partial redemption or purchase by lot, the particular
Notes to be redeemed or purchased will be selected, unless otherwise provided
herein, not less than 30 nor more than 60 days prior to the redemption or
purchase date by the Trustee from the outstanding Notes not previously called
for redemption or purchase.
The Trustee will promptly notify the Company in writing of the Notes
selected for redemption or purchase and, in the case of any Note selected for
partial redemption or purchase, the principal amount thereof to be redeemed or
purchased. Notes and portions of Notes selected will 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 or purchased, the entire outstanding amount of Notes held by such
Holder, even if not a multiple of $1,000, shall be redeemed or purchased.
Except as provided in the preceding sentence, provisions of this Indenture that
apply to Notes called for redemption or purchase also apply to portions of Notes
called for redemption or purchase.
Section 3.03 Notice of Redemption.
Subject to the provisions of Section 3.09 hereof, at least 10 days but
not more than 60 days before a redemption date, the Company will 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, except that redemption
notices may be mailed more than 60 days prior to a redemption date if the notice
is issued in
39
connection with a defeasance of the Notes or a satisfaction and discharge of
this Indenture pursuant to Articles 8 or 11 hereof.
The notice will identify the Notes to be redeemed and will state:
(1) the redemption date;
(2) the redemption price;
(3) 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 will be issued upon
cancellation of the original Note;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
(6) that, unless the Company defaults in making such
redemption payment, interest on Notes called for redemption ceases to
accrue on and after the redemption date;
(7) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are being
redeemed; and
(8) that no representation is made as to the correctness
or accuracy of the CUSIP number, if any, listed in such notice or
printed on the Notes.
At the Company's request, the Trustee will give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company has delivered to the Trustee, at least 45 days prior to the redemption
date, an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in 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. A notice of redemption may not be
conditional.
Section 3.05 Deposit of Redemption or Purchase Price.
One Business Day prior to the redemption or purchase date, the Company
will deposit with the Trustee or with the Paying Agent money sufficient to pay
the redemption or purchase price of and accrued interest and Liquidated Damages,
if any, on all Notes to be redeemed or purchased on that date. The Trustee or
the Paying Agent will promptly return to the Company any money deposited with
the Trustee or the Paying Agent by the Company in excess of the amounts
necessary to pay the redemption or purchase price of, and accrued interest and
Liquidated Damages, if any, on, all Notes to be redeemed or purchased.
If the Company complies with the provisions of the preceding paragraph,
on and after the redemption or purchase date, interest will cease to accrue on
the Notes or the portions of Notes called for
40
redemption or purchase. If a Note is redeemed or purchased 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 or purchase is not so paid upon surrender for redemption
or purchase because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the redemption
or purchase 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.
Section 3.06 Notes Redeemed or Purchased in Part.
Upon surrender of a Note that is redeemed or purchased in part, the
Company will issue and, upon receipt of an Authentication Order, the Trustee
will authenticate for the Holder at the expense of the Company a new Note equal
in principal amount to the unredeemed or unpurchased portion of the Note
surrendered.
Section 3.07 Optional Redemption.
(a) At any time prior to August 15, 2006, the Company may on any
one or more occasions redeem up to 35% of the aggregate principal amount of
Notes issued under this Indenture at a redemption price of 111.7500% of the
principal amount, plus accrued and unpaid interest and Liquidated Damages, if
any, to the redemption date, with the net cash proceeds of one or more Equity
Offerings (provided that, if the Equity Offering is an offering by Parent, a
portion of the net cash proceeds thereof equal to the amount required to redeem
any such Notes is contributed to the equity capital of the Company or used to
acquire Capital Stock (other than Disqualified Stock) of the Company); provided
that:
(1) at least 65% of the aggregate principal amount of
Notes issued under this Indenture (excluding Notes held by the Company
and its Subsidiaries) remains outstanding immediately after the
occurrence of such redemption; and
(2) the redemption must occur within 90 days of the date
of the closing of such Equity Offering.
(b) Except pursuant to the preceding paragraph, the Notes are not
redeemable at the Company's option prior to August 15, 2008.
(c) On or after August 15, 2008, the Company may redeem all or a
part of the Notes upon not less than 10 nor more than 60 days' notice, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest and Liquidated Damages, if any, on the Notes
redeemed, to the applicable redemption date, if redeemed during the twelve-month
period beginning on August 15 of the years indicated below:
Year Percentage
---- ----------
2008.................................... 105.8750%
2009.................................... 102.9375%
2010 and thereafter..................... 100.0000%
Unless the Company defaults in the payment of the redemption price,
interest will cease to accrue on the Notes or portions thereof called for
redemption on the applicable redemption date.
41
(d) 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 Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.
Section 3.09 Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company is
required to commence an offer to all Holders to purchase Notes (an "Asset Sale
Offer"), it will follow the procedures specified below.
The Asset Sale Offer shall be made to all Holders and all holders of
other Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in this Indenture with respect to offers to purchase
or redeem with the proceeds of sales of assets to purchase on a pro rata basis
the maximum principal amount of Notes and such other pari passu Indebtedness
that may be purchased out of the Excess Proceeds. The Asset Sale Offer will
remain open for a period of at least 20 Business Days following its commencement
and not more than 30 Business Days, except to the extent that a longer period is
required by applicable law (the "Offer Period"). No later than three Business
Days after the termination of the Offer Period (the "Purchase Date"), the
Company will apply all Excess Proceeds (the "Offer Amount") to the purchase of
Notes and such other pari passu Indebtedness (on a pro rata basis, if
applicable) or, if less than the Offer Amount has been tendered, all Notes and
other Indebtedness tendered in response to the Asset Sale Offer. Payment for any
Notes so purchased will 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 and
Liquidated Damages, if any, will 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 will be payable to Holders who tender Notes pursuant to the Asset Sale
Offer.
Upon the commencement of an Asset Sale Offer, the Company will send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice will contain all instructions and materials necessary
to enable such Holders to tender Notes pursuant to the Asset Sale Offer. The
notice, which will govern the terms of the Asset Sale Offer, will state:
(1) that the Asset Sale Offer is being made pursuant to
this Section 3.09 and Section 4.10 hereof and the length of time the
Asset Sale Offer will remain open;
(2) the Offer Amount, the purchase price and the Purchase
Date;
(3) that any Note not tendered or accepted for payment
will continue to accrue interest;
(4) that, unless the Company defaults in making such
payment, any Note accepted for payment pursuant to the Asset Sale Offer
will cease to accrue interest after the Purchase Date;
(5) that Holders electing to have a Note purchased
pursuant to an Asset Sale Offer may elect to have Notes purchased in
integral multiples of $1,000 only;
42
(6) that Holders electing to have a Note purchased
pursuant to any Asset Sale Offer will be required to surrender the
Note, with the form entitled "Option of Holder to Elect Purchase"
attached to the Note completed, or transfer by book-entry transfer, to
the Company, a Depositary, if appointed by the Company, or a Paying
Agent at the address specified in the notice at least three Business
Days before the Purchase Date;
(7) that Holders will be entitled to withdraw their
election if the Company, the Depositary or the Paying Agent, as the
case may be, receives, not later than the expiration of the Offer
Period, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Notes the
Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Notes purchased;
(8) that, if the aggregate principal amount of Notes and
other pari passu Indebtedness surrendered by holders thereof exceeds
the Offer Amount, the Company will select the Notes and other pari
passu Indebtedness to be purchased on a pro rata basis based on the
principal amount of Notes and such other pari passu Indebtedness
surrendered (with such adjustments as may be deemed appropriate by the
Company so that only Notes in denominations of $1,000, or integral
multiples thereof, will be purchased); and
(9) that Holders whose Notes were purchased only in part
will 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 the Purchase Date, the Company will, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer,
or if less than the Offer Amount has been tendered, all Notes tendered, and will
deliver or cause to be delivered to the Trustee the Notes properly accepted
together with an Officers' Certificate stating that such Notes or portions
thereof were accepted for payment by the Company in accordance with the terms of
this Section 3.09. The Company, the Depositary or the Paying Agent, as the case
may be, will promptly (but in any case not later than five 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 Company
for purchase, and the Company will promptly issue a new Note, and the Trustee,
upon written request from the Company, will authenticate and mail or deliver (or
cause to be transferred by book entry) such new Note to such Holder, in a
principal amount equal to any unpurchased portion of the Note surrendered. Any
Note not so accepted shall be promptly mailed or delivered by the Company to the
Holder thereof. The Company will publicly announce the results of the Asset Sale
Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes.
The Company will pay or cause to be paid the principal of, premium, if
any, and interest and Liquidated Damages, if any, on the Notes on the dates and
in the manner provided in the Notes. Principal, premium, if any, and interest
and Liquidated Damages, if any will be considered paid on the date due if the
Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 10
:00 a.m. Eastern Time on the due date money deposited by the Company in
immediately available funds and
43
designated for and sufficient to pay all principal, premium, if any, and
interest then due. The Company will pay all Liquidated Damages, if any, in the
same manner on the dates and in the amounts set forth in the Registration Rights
Agreement.
The Company will 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 will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace period) at the same
rate to the extent lawful.
Section 4.02 Maintenance of Office or Agency.
The Company will 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 Company in respect of the Notes and this Indenture may be served. The
Company will give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
fails to maintain any such required office or agency or fails 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 Company 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 will in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company will give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee
as one such office or agency of the Company in accordance with Section 2.03
hereof.
Section 4.03 Reports.
(a) Whether or not required by the rules and regulations of the
SEC, so long as any Notes are outstanding, the Company will furnish to the
Holders of Notes or cause the Trustee to furnish to the Holders of Notes, within
the time periods specified in the SEC's rules and regulations:
(1) all quarterly and annual financial information that
would be required to be contained in a filing with the SEC on Forms
10-Q and 10-K if the Company were required to file such forms,
including a "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and, with respect to the annual
information only, a report on the annual financial statements by the
Company's certified independent accountants; and
(2) all current reports that would be required to be
filed with the SEC on Form 8-K if the Company were required to file
such reports.
In addition, whether or not required by the SEC, the Company will file
a copy of all of the information and reports referred to in clauses (1) and (2)
above with the SEC for public availability within the time periods specified in
the SEC's rules and regulations (unless the SEC will not accept such a filing)
and make such information available to securities analysts and prospective
investors upon request. The Company will at all times comply with TIA Section
314(a).
44
(b) If, at any time, the Company is no longer subject to the
periodic reporting requirements of the Exchange Act for any reason, the Company
will nevertheless continue filing the reports specified in the preceding
paragraph with the SEC within the time periods specified above unless the SEC
will not accept such a filing. The Company agrees that it will not take any
action for the purpose of causing the SEC not to accept any such filings. If,
notwithstanding the foregoing, the SEC will not accept the Company's filings for
any reason, the Company will post the reports referred to in the preceding
paragraph on its website within the time periods that would apply if the Company
were required to file those reports with the SEC.
If the Company has designated any of its Subsidiaries as Unrestricted
Subsidiaries and the aggregate total assets of such Unrestricted Subsidiaries
exceeds $1.0 million, then the quarterly and annual financial information
required by the preceding paragraph will include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes
thereto, and in Management's Discussion and Analysis of Financial Condition and
Results of Operations, of the financial condition and results of operations of
the Company and its Restricted Subsidiaries separate from the financial
condition and results of operations of the Unrestricted Subsidiaries of the
Company.
(c) Notwithstanding the foregoing, if Parent is a Guarantor, holds
no material assets other than cash, Cash Equivalents and the Capital Stock of
the Company (and performs the related incidental activities associated with such
ownership) and complies with the requirements of Rule 3-10 of Regulation S-X
promulgated by the SEC (or any successor provision), the reports, information
and other documents required to be filed with the SEC and/or furnished to
Holders of the Notes pursuant to this Section 4.03 may, at the option of the
Company, be filed by and be those of Parent rather than the Company.
(d) The Company and the Guarantors will furnish to the Holders and
to securities analysts and prospective investors, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.
Section 4.04 Compliance Certificate.
(a) The Company and each Guarantor (to the extent that such
Guarantor is so required under the TIA) shall deliver to the Trustee, within 90
days after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every 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 has occurred, describing all
such Defaults or Events of Default of which he or she may have knowledge and
what action the Company 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 the Company is taking or proposes to
take with respect thereto.
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03 above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article 4 or Article 5 hereof or, if any such violation has
45
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) So long as any of the Notes are outstanding, the Company will
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.
Section 4.05 Taxes.
The Company will pay, and will 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.
Section 4.06 Stay, Extension and Usury Laws.
The Company and each of the Guarantors covenants (to the extent that it
may lawfully do so) that it will not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Company and
each of the Guarantors (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law has been enacted.
Section 4.07 Restricted Payments.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly:
(1) declare or pay any dividend or make any other payment
or distribution on account of the Company's or any of its Restricted
Subsidiaries' Equity Interests (including, without limitation, any
payment in connection with any merger or consolidation involving the
Company or any of its Restricted Subsidiaries) or to the direct or
indirect holders of the Company's or any of its Restricted
Subsidiaries' Equity Interests in their capacity as such (other than
dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of the Company and other than dividends or
distributions payable to the Company or a Restricted Subsidiary of the
Company);
(2) purchase, redeem or otherwise acquire or retire for
value (including without limitation, in connection with any merger or
consolidation involving the Company) any Equity Interests of the
Company or any direct or indirect parent of the Company;
(3) make any payment on or with respect to, or purchase,
redeem, defease or otherwise acquire or retire for value any
Indebtedness of the Company or any Guarantor that is contractually
subordinated to the Notes or to any Note Guarantee (excluding any
intercompany Indebtedness between or among the Company and any of its
Restricted Subsidiaries), except a payment of interest or principal at
the Stated Maturity thereof; or
46
(4) make any Restricted Investment (all such payments and
other actions set forth in these clauses (1) through (4) above being
collectively referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted
Payment:
(1) no Default or Event of Default has occurred and is
continuing or would occur as a consequence of such Restricted Payment;
and
(2) the Debt to Cash Flow Ratio for the Company's most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date on which such
Restricted Payment is made would have been no greater than 5.0 to 1,
determined on a pro forma basis (including a pro forma application of
the net proceeds therefrom), as if such Restricted Payment had been
made at the beginning of such four-quarter period; and
(3) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and its
Restricted Subsidiaries after the date of this Indenture (excluding
Restricted Payments permitted by clauses (2), (3), (4), (6), (7), (8)
and (9) of paragraph (b) below), is less than the sum, without
duplication of:
(A) 50% of the Consolidated Net Income of the
Company for the period (taken as one accounting period) from
the beginning of the first calendar month commencing after the
date of this Indenture to the end of the Company's most
recently ended calendar month for which internal financial
statements are available at the time of such Restricted
Payment (or, if such Consolidated Net Income for such period
is a deficit, less 100% of such deficit);plus
(B) 100% of the aggregate net proceeds
(including the Fair Market Value of property other than cash
or Cash Equivalents) received by the Company since the date of
this Indenture as a contribution to its equity capital or from
the issue or sale of Equity Interests of the Company (other
than Disqualified Stock) or from the issue or sale of
convertible or exchangeable Disqualified Stock or convertible
or exchangeable debt securities of the Company that have been
converted into or exchanged for such Equity Interests (other
than Equity Interests (or Disqualified Stock or debt
securities) sold to a Subsidiary of the Company);plus
(C) 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 lesser of
(i) the cash return of capital with respect to such Restricted
Investment (less the cost of disposition, if any) and (ii) the
initial amount of such Restricted Investment;plus
(D) to the extent that any Unrestricted
Subsidiary of the Company designated as such after the date of
this Indenture is redesignated as a Restricted Subsidiary
after the date of this Indenture, the lesser of (i) the Fair
Market Value of the Company's Investment in such Subsidiary as
of the date of such redesignation or (ii) such Fair Market
Value as of the date on which such Subsidiary was originally
designated as an Unrestricted Subsidiary after the date of
this Indenture;plus
(E) 50% of any dividends received by the Company
or a Restricted Subsidiary of the Company after the date of
this Indenture from an Unrestricted
47
Subsidiary of the Company, to the extent that such dividends
were not otherwise included in Consolidated Net Income of the
Company for such period.
(b) The provisions of Section 4.07(a) will not prohibit:
(1) the payment of any dividend within 60 days after the
date of declaration of the dividend, if at the date of declaration the
dividend payment would have complied with the provisions of this
Indenture;
(2) the making of any Restricted Payment in exchange for,
or out of the net cash proceeds of the substantially concurrent sale
(other than to a Subsidiary of the Company) of, Equity Interests of the
Company (other than Disqualified Stock) or from the substantially
concurrent contribution of common equity capital to the Company
;provided that the amount of any such net cash proceeds that are
utilized for any such Restricted Payment will be excluded from clause
(3)(B) of the preceding paragraph;
(3) the defeasance, redemption, repurchase or other
acquisition of Indebtedness of the Company or any Guarantor that is
contractually subordinated to the Notes or to any Note Guarantee with
the net cash proceeds from a substantially concurrent incurrence of
Permitted Refinancing Indebtedness;
(4) the payment of any dividend (or, in the case of any
partnership or limited liability company, any similar distribution) by
a Restricted Subsidiary of the Company to the holders of its Equity
Interests on a pro rata basis;
(5) so long as no Default has occurred and is continuing
or would be caused thereby, the repurchase, redemption or other
acquisition or retirement for value of any Equity Interests of Parent,
the Company or any Restricted Subsidiary of the Company held by any
current or former officer, director or employee of Parent, the Company
or any Restricted Subsidiary of the Company pursuant to any equity
subscription agreement, stock option agreement, shareholders' agreement
or similar agreement ;provided that the aggregate price paid for all
such repurchased, redeemed, acquired or retired Equity Interests may
not exceed the sum of (A) $1.0 million in any calendar year (with
unused amounts in any calendar year being available to be so utilized
in the immediately succeeding calendar year) and (B) the net cash
proceeds to the Company from any issuance or reissuance of Equity
Interests of the Company or any Restricted Subsidiary (other than
Disqualified Stock) to members of management (which are excluded from
the calculation set forth in clause (3)(B) of the preceding paragraph)
and (C) the net cash proceeds to the Company of any "key man" life
insurance proceeds;
(6) the repurchase of Equity Interests deemed to occur
upon the exercise of stock options;
(7) the declaration and payment of regularly scheduled or
accrued dividends to holders of any class or series of Disqualified
Stock of the Company or any Restricted Subsidiary of the Company issued
on or after the date of this Indenture in accordance with the Debt to
Cash Flow Ratio test described in Section 4.09 hereof;
(8) the payment of dividends to Parent to be used by
Parent to pay (A) franchise taxes and other fees, taxes and expenses
required to maintain its corporate existence and (B) for general
corporate and overhead expenses (including salaries and other
compensation of
48
employees and professional expenses) incurred by Parent in the ordinary
course of its business; provided, however, that such dividends shall
not exceed $500,000 in any calendar year;
(9) for so long as the Company is a member of a group
filing a consolidated or combined tax return with the Parent, payments
to Parent in respect of an allocable portion of the tax liabilities of
such group that is attributable to the Company and its Subsidiaries
("Tax Payments"); provided, however, that (A) the Tax Payments shall
not exceed the lesser of (1) the amount of the relevant tax (including
any penalties and interest) that the Company would owe if the Company
were filing a separate tax return (or a separate consolidated or
combined return with its Subsidiaries that are members of the
consolidated or combined group), taking into account any carryovers and
carrybacks of tax attributes (such as net operating losses) of the
Company and such Subsidiaries from other taxable years and (2) the net
amount of the relevant tax that Parent actually owes to the appropriate
taxing authority, and (B) any Tax Payments received from the Company
shall be paid over to the appropriate taxing authority within 30 days
of Parent's receipt of such Tax Payments or refunded to the Company;
and
(10) other Restricted Payments in an aggregate amount not
to exceed $10.0 million since the date of this Indenture.
The amount of all Restricted Payments (other than cash) will 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 Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The Fair Market Value of any assets or securities that are required to be valued
by this Section 4.07 will be determined by the Board of Directors of the
Company whose resolution with respect thereto shall be delivered to the Trustee.
The Board of Directors' determination must be based upon an opinion or
appraisal issued by an accounting, appraisal or investment banking firm of
national standing if the fair market value exceeds $10.0 million. Not later than
the date of making any Restricted Payment, the Company will deliver to the
Trustee an Officers' 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 .
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or permit to exist or
become effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(1) pay dividends or make any other distributions on its
Capital Stock to the Company or any of its Restricted Subsidiaries, or
with respect to any other interest or participation in, or measured by,
its profits, or pay any indebtedness owed to the Company or any of its
Restricted Subsidiaries;
(2) make loans or advances to the Company or any of its
Restricted Subsidiaries; or
(3) sell, lease or transfer any of its properties or
assets to the Company or any of its Restricted Subsidiaries.
(b) The restrictions in Section 4.08(a) will not apply to
encumbrances or restrictions existing under or by reason of:
49
(1) agreements governing Existing Indebtedness and Credit
Facilities as in effect on the date of this Indenture and any
amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings of those
agreements, provided that the amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or
refinancings are no more restrictive, taken as a whole, with respect to
such dividend and other payment restrictions than those contained in
those agreements, as in effect on the date of this Indenture;
(2) this Indenture, the Notes and the Note Guarantees;
(3) applicable law, rule, regulation or order;
(4) any instrument governing Indebtedness or Capital
Stock of a Person acquired by the Company 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, or the property or assets of the Person,
so acquired; provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be
incurred;
(5) customary non-assignment provisions in contracts,
licenses and other agreements entered into in the ordinary course of
business;
(6) purchase money obligations for property acquired in
the ordinary course of business and Capital Lease Obligations that
impose restrictions on the property purchased or leased of the nature
described in clause (3) of Section 4.08(a);
(7) contracts for the sale of assets, including, without
limitation, any agreement for the sale or other disposition of the
assets or Capital Stock of a Restricted Subsidiary that restricts
distributions by that Restricted Subsidiary pending such sale or other
disposition;
(8) Permitted Refinancing Indebtedness; provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are not materially more restrictive, taken as
a whole, than those contained in the agreements governing the
Indebtedness being refinanced;
(9) Liens securing Indebtedness otherwise permitted to be
incurred under the provisions of Section 4.12 hereof that limit the
right of the debtor to dispose of the assets subject to such Liens;
(10) provisions with respect to the disposition or
distribution of assets or property in joint venture agreements, assets
sale agreements, sale-leaseback agreements, stock sale agreements and
other similar agreements entered into in the ordinary course of
business; and
(11) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary
course of business.
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, issue,
assume, guarantee or otherwise become directly or indirectly liable,
50
contingently or otherwise, with respect to (collectively, "incur") any
Indebtedness (including Acquired Debt), and the Company will not issue any
Disqualified Stock and will not permit any of its Restricted Subsidiaries to
issue any shares of preferred stock; provided, however, that the Company and the
Guarantors may incur Indebtedness (including Acquired Debt) or issue
Disqualified Stock or preferred stock if the Debt to Cash Flow Ratio for the
Company's most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Disqualified Stock or such preferred
stock, as the case may be, is issued would have been no greater than 5.25 to 1,
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom), as if the additional Indebtedness had been incurred or the
Disqualified Stock or the preferred stock had been issued, as the case may be,
at the beginning of such four-quarter period.
(b) The provisions of Section 4.09(a) will not prohibit the
incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):
(1) the incurrence by the Company and any Guarantor of
Indebtedness on the date of this Indenture under the Term Loan
Agreement less the aggregate amount of all repayments, optional or
mandatory, of the principal of the Term Loan Agreement (other than
repayments that are concurrently refunded or refinanced);
(2) the incurrence by the Company and its Restricted
Subsidiaries of the Existing Indebtedness;
(3) the incurrence by the Company and the Guarantors of
Indebtedness represented by the Notes and the related Note Guarantees
to be issued on the date of this Indenture and the Exchange Notes and
the related Note Guarantees to be issued pursuant to the Registration
Rights Agreement;
(4) the incurrence by the Company or any of its
Restricted Subsidiaries of Permitted Refinancing Indebtedness in
exchange for, or the net proceeds of which are used to refund,
refinance, replace, defease or discharge Indebtedness (other than
intercompany Indebtedness) that was permitted by this Indenture to be
incurred under Section 4.09(a) or clauses (2), (3) or (4) of this
Section 4.09(b);
(5) the incurrence by the Company or any of its
Restricted Subsidiaries of intercompany Indebtedness between or among
the Company and any of its Restricted Subsidiaries; provided, however,
that:
(A) if the Company or any Guarantor is the
obligor on such Indebtedness and the payee is not the Company
or a Guarantor, such Indebtedness must be expressly
subordinated to the prior payment in full in cash of all
Obligations then due with respect to the Notes, in the case of
the Company, or the Note Guarantee, in the case of a
Guarantor; and
(B) (i) any subsequent issuance or transfer of
Equity Interests that results in any such Indebtedness being
held by a Person other than the Company or a Restricted
Subsidiary of the Company and (ii) any sale or other transfer
of any such Indebtedness to a Person that is not either the
Company or a Restricted Subsidiary of the Company,
will be deemed, in each case, to constitute an incurrence of such Indebtedness
by the Company or such Restricted Subsidiary, as the case may be, that was not
permitted by this clause (5);
51
(6) the issuance by any of the Company's Restricted
Subsidiaries to the Company or to any of its Restricted Subsidiaries of
shares of preferred stock; provided, however, that:
(A) any subsequent issuance or transfer of
Equity Interests that results in any such preferred stock
being held by a Person other than the Company or a Restricted
Subsidiary of the Company; and
(B) any sale or other transfer of any such
preferred stock to a Person that is not either the Company or
a Restricted Subsidiary of the Company,
will be deemed, in each case, to constitute an issuance of such preferred stock
by such Restricted Subsidiary that was not permitted by this clause (6);
(7) the incurrence by the Company or any of its
Restricted Subsidiaries of Hedging Obligations in the ordinary course
of business;
(8) the guarantee by the Company or any of the Guarantors
of Indebtedness of the Company or a Restricted Subsidiary of the
Company that was permitted to be incurred by another provision of this
covenant; provided that if the Indebtedness being guaranteed is
subordinated to the Notes, then the guarantee shall be subordinated to
the same extent as the Indebtedness guaranteed;
(9) the incurrence by the Company or any of its
Restricted Subsidiaries of Indebtedness in respect of workers'
compensation claims, health, disability or other employee benefits,
property, casualty or liability insurance, or self-insurance or other
reimbursement-type obligations, bankers' acceptances, performance and
surety bonds and the like in the ordinary course of business;
(10) the incurrence by the Company or any of its
Restricted Subsidiaries of Indebtedness arising from the honoring by a
bank or other financial institution of a check, draft or similar
instrument inadvertently drawn against insufficient funds, so long as
such Indebtedness is covered within two Business Days;
(11) Indebtedness consisting of customary indemnification,
adjustments of purchase price or similar obligations, in each case,
incurred or assumed in connection with the acquisition of any business
or assets or otherwise in the ordinary course of business; and
(12) the incurrence by the Company or any Guarantor of
additional Indebtedness hereunder in an aggregate principal amount
that, when aggregated with the principal amount of all other
Indebtedness then outstanding and incurred pursuant to this clause
(12), does not at any one time outstanding exceed $30.0 million.
The Company will not incur, and will not permit any Guarantor to incur,
any Indebtedness (including Permitted Debt) that is contractually subordinated
in right of payment to any other Indebtedness of the Company or such Guarantor
unless such Indebtedness is also contractually subordinated in right of payment
to the Notes and the applicable Note Guarantee on substantially identical terms;
provided, however, that no Indebtedness of the Company shall be deemed to be
contractually subordinated in right of payment to any other Indebtedness of the
Company solely by virtue of being unsecured or by virtue of being secured on a
first or junior Lien basis.
52
The accrual of interest, the accretion or amortization of original
issue discount, the payment of interest on any Indebtedness in the form of
additional Indebtedness with the same terms, and the payment of dividends on
Disqualified Stock in the form of additional shares of the same class of
Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an
issuance of Disqualified Stock for purposes of this Section 4.09; provided, in
each such case, that the amount thereof is included in Consolidated Interest
Expense of the Company as accrued. Notwithstanding any other provision of this
Section 4.09, the maximum amount of Indebtedness that the Company or any
Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be
deemed to be exceeded solely as a result of fluctuations in exchange rates or
currency values.
The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case
of any Indebtedness issued with original issue discount;
(2) the principal amount of the Indebtedness, in the case
of any other Indebtedness; and
(3) in respect of Indebtedness of another Person secured
by a Lien on the assets of the specified Person, the lesser of:
(a) the Fair Market Value of such asset at the
date of determination; and
(b) the amount of the Indebtedness of the other
Person.
Section 4.10 Asset Sales.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) the Company (or the Restricted Subsidiary, as the
case may be) receives consideration at the time of the Asset Sale at
least equal to the Fair Market Value of the assets or Equity Interests
issued or sold or otherwise disposed of; and
(2) at least 75% of the consideration received in the
Asset Sale by the Company or such Restricted Subsidiary is in the form
of cash or Cash Equivalents. For purposes of this provision, each of
the following will be deemed to be cash:
(A) any liabilities, as shown on the Company's
most recent consolidated balance sheet, of the Company or any
Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes
or any Note Guarantee) that are assumed by the transferee of
any such assets and for which the Company and all Restricted
Subsidiaries of the Company have been released by all
creditors in writing;
(B) any securities, notes or other obligations
received by the Company or any such Restricted Subsidiary from
such transferee that are contemporaneously, subject to
ordinary settlement periods, converted by the Company or such
Restricted Subsidiary into cash, to the extent of the cash
received in that conversion; and
53
(C) any stock or assets of the kind referred to
in clauses (2) or (4) of the next paragraph of this Section
4.10.
The 75% limitation referred to in clause (2) above will not apply to
any Asset Sale in which the cash or Cash Equivalents portion of the
consideration received therefrom, determined in accordance with the preceding
provision, is equal to or greater than what the after-tax proceeds would have
been had such Asset Sale complied with the aforementioned 75% limitation.
Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company (or the applicable Restricted Subsidiary, as the case may be)
may apply such Net Proceeds at its option:
(1) to repay Indebtedness and other Obligations under any
Credit Facilities and, if the Indebtedness repaid is revolving credit
Indebtedness, to correspondingly reduce commitments with respect
thereto;
(2) to acquire all or substantially all of the assets of,
or any Capital Stock of, another Permitted Business, if, after giving
effect to any such acquisition of Capital Stock, the Permitted Business
is or becomes a Restricted Subsidiary of the Company;
(3) to make a capital expenditure; or
(4) to acquire other assets that are not classified as
current assets under GAAP and that are used or useful in a Permitted
Business.
Pending the final application of any Net Proceeds, the Company may
temporarily reduce revolving credit borrowings or otherwise invest the 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 preceding paragraph will constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $10.0 million, within five days
thereof, the Company will make an Asset Sale Offer to all Holders of Notes and
all holders of other Indebtedness that is pari passu with the Notes containing
provisions similar to those set forth in this Indenture with respect to offers
to purchase or redeem with the proceeds of sales of assets in accordance with
Section 3.09 hereof to purchase the maximum principal amount of Notes and such
other pari passu Indebtedness that may be purchased out of the Excess Proceeds.
The offer price in any Asset Sale Offer will be equal to 100% of principal
amount plus accrued and unpaid interest and Liquidated Damages, if any, to the
date of purchase, and will be payable in cash . If any Excess Proceeds remain
after consumption of an Asset Sale Offer, the Company may use such Excess
Proceeds for any purpose not otherwise prohibited by this Indenture. If the
aggregate principal amount of Notes and such other pari passu Indebtedness
tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the
Trustee shall select the Notes and such other pari passu Indebtedness to be
purchased on a pro rata basis based on the principal amount of Notes and such
other pari passu Indebtedness tendered Upon completion of each Asset Sale Offer,
the amount of Excess Proceeds shall be reset at zero.
The Company will 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 each
repurchase of Notes pursuant to an Asset Sale Offer . To the extent that the
provisions of any securities laws or regulations conflict with the provisions of
Sections 3.09 or 4.10 of this Indenture, the Company will comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under Section 3.09 or this Section 4.10 by virtue of
such compliance.
54
Section 4.11 Transactions with Affiliates.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, 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 guarantee with, or for the
benefit of, any Affiliate of the Company (each an "Affiliate Transaction"),
unless:
(1) the Affiliate Transaction is on terms that are no
less favorable to the Company or the relevant Restricted Subsidiary
than those that would have been obtained in a comparable transaction by
the Company or such Restricted Subsidiary with an unrelated Person; and
(2) the Company delivers to the Trustee:
(A) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate
consideration in excess of $2.5 million, a resolution of the
Board of Directors set forth in an Officers' Certificate
certifying that such Affiliate Transaction complies with
clause (1) of this Section 4.11 (a) and that such Affiliate
Transaction has been approved by a majority of the
disinterested 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 Company or such Subsidiary of such
Affiliate Transaction from a financial point of view issued by
an accounting, appraisal or investment banking firm of
national standing.
(b) The following items will not be deemed to be Affiliate
Transactions and, therefore, will not be subject to the provisions of Section
4.11(a):
(1) any employment agreement, employee benefit plan,
officer and director indemnification agreement or any similar
arrangement entered into by the Company or any of its Restricted
Subsidiaries in the ordinary course of business;
(2) transactions between or among the Company and/or its
Restricted Subsidiaries;
(3) transactions with a Person (other than an
Unrestricted Subsidiary of the Company) that is an Affiliate of the
Company solely because the Company owns, directly or through a
Restricted Subsidiary, an Equity Interest in, or controls, such Person;
(4) loans, advances, payment of reasonable fees,
indemnification of directors, or similar arrangements to or with
officers, directors, employees and consultants who are not otherwise
Affiliates of the Company;
(5) any issuance of Equity Interests (other than
Disqualified Stock) of the Company to Affiliates of the Company; and
(6) Restricted Payments and Permitted Investments that
are permitted by Section 4.07 hereof.
55
Section 4.12 Liens.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien of any kind on any asset now owned or hereafter acquired, except
Permitted Liens.
Section 4.13 Business Activities.
The Company will not, and will 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 Company and its Restricted
Subsidiaries taken as a whole.
Section 4.14 Corporate Existence.
Subject to Article 5 hereof, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect:
(1) its corporate existence, and the corporate,
partnership or other existence of each of its Subsidiaries, in
accordance with the respective organizational documents (as the same
may be amended from time to time) of the Company or any such
Subsidiary; and
(2) the rights (charter and statutory), licenses and
franchises of the Company and its Subsidiaries; provided, however, that
the Company shall not be required to preserve any such right, license
or franchise, or the corporate, partnership or other existence of any
of its Subsidiaries, if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the
business of the Company and its Subsidiaries, taken as a whole, and
that the loss thereof is not adverse in any material respect to the
Holders of the Notes.
Section 4.15 Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, the Company will
make an offer (a "Change of Control Offer") to each Holder to repurchase all or
any part (equal to $1,000 or an integral multiple of $1,000) of each Holder's
Notes at a purchase price equal to 101% of the aggregate principal amount of
Notes repurchased plus accrued and unpaid interest and Liquidated Damages, if
any, on the Notes repurchased, to the date of purchase (the "Change of Control
Payment). Within 30 days following any Change of Control, the Company will mail
a notice to each Holder describing the transaction or transactions that
constitute the Change of Control and stating:
(1) that the Change of Control Offer is being made
pursuant to this Section 4.15 and that all Notes tendered will be
accepted for payment;
(2) the purchase price and the purchase date, which shall
be no earlier than 30 days and no later than 60 days from the date such
notice is mailed (the "Change of Control Payment Date");
(3) that any Note not tendered will continue to accrue
interest;
(4) that, unless the Company defaults in the payment of
the Change of Control Payment, all Notes accepted for payment pursuant
to the Change of Control Offer will cease to accrue interest after the
Change of Control Payment Date;
56
(5) that Holders electing to have any Notes purchased
pursuant to a Change of Control Offer will be required to surrender the
Notes, with the form entitled "Option of Holder to Elect Purchase"
attached to the Notes completed, or transfer by book-entry transfer, to
the Paying Agent at the address specified in the notice prior to the
close of business on the third Business Day preceding the Change of
Control Payment Date;
(6) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the close of
business on the second Business Day preceding the Change of Control
Payment Date, a telegram, telex, facsimile transmission or letter
setting forth the name of the Holder, the principal amount of Notes the
Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Notes purchased; and
(7) that Holders whose Notes are being purchased only in
part will be issued new Notes equal in principal amount to the
unpurchased portion of the Notes surrendered, which unpurchased portion
must be equal to $1,000 in principal amount or an integral multiple
thereof.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change in Control. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of Sections 3.09 or 4.15 of this Indenture, the Company will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under Section 3.09 or this Section 4.15 by virtue
of such compliance.
(b) On the Change of Control Payment Date, the Company will, to
the extent lawful:
(1) accept for payment all Notes or portions of Notes
properly tendered pursuant to the Change of Control Offer;
(2) deposit with the Paying Agent an amount equal to the
Change of Control Payment in respect of all Notes or portions of Notes
properly tendered; and
(3) deliver or cause to be delivered to the Trustee the
Notes properly accepted together with an Officers' Certificate stating
the aggregate principal amount of Notes or portions of Notes being
purchased by the Company.
The Paying Agent will promptly mail to each Holder of Notes properly
tendered the Change of Control Payment for such Notes, and the Trustee will
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; provided that each new Note will be in a
principal amount of $1,000 or an integral multiple thereof. The Company will
publicly announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.
(c) Notwithstanding anything to the contrary in this Section
4.15, the Company will not be required to make a Change of Control Offer upon a
Change of Control if (1) 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 Section 4.15 and Section 3.09 hereof and purchases all Notes validly
tendered and not withdrawn under the Change of Control Offer, or (2) notice of
redemption has been given pursuant to Section 3.07 hereof, unless and until
there is a default in payment of the applicable redemption price.
57
Section 4.16 Limitation on Sale and Leaseback Transactions.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company or any Restricted Subsidiary may enter into a sale and leaseback
transaction if:
(1) the Company or that Restricted Subsidiary, as
applicable, could have (a) incurred Indebtedness in an amount equal to
the Attributable Debt relating to such sale and leaseback transaction
and (b) incurred a Lien to secure such Indebtedness pursuant to the
provisions of Section 4.12 hereof;
(2) the gross cash proceeds of that sale and leaseback
transaction are at least equal to the Fair Market Value, as determined
in good faith by the Board of Directors and set forth in an Officers'
Certificate delivered to the Trustee, of the property that is the
subject of that sale and leaseback transaction; and
(3) the transfer of assets in that sale and leaseback
transaction is permitted by, and the Company applies the proceeds of
such transaction in compliance with, Section 4.10 hereof.
Section 4.17 Payments for Consent.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder of 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
and 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 4.18 Additional Note Guarantees.
If the Company or any of its Restricted Subsidiaries acquires or
creates another Domestic Subsidiary after the date of this Indenture, then that
newly acquired or created Domestic Subsidiary will become a Guarantor and
execute a supplemental indenture and deliver an Opinion of Counsel to the
Trustee within ten Business Days of the date on which it was acquired or
created; provided that any Domestic Subsidiary that constitutes an Immaterial
Subsidiary need not become a Guarantor until such time as it ceases to be an
Immaterial Subsidiary.
Section 4.19 Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if that designation would not cause a Default. If a
Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate
Fair Market Value of all outstanding Investments owned by the Company and its
Restricted Subsidiaries in the Subsidiary designated as Unrestricted will be
deemed to be an Investment made as of the time of the designation and will
reduce the amount available for Restricted Payments under Section 4.07 hereof
or under one or more clauses of the definition of Permitted Investments, as
determined by the Company. That designation will only be permitted if the
Investment would be permitted at that time and if the Restricted Subsidiary
otherwise meets the definition of an Unrestricted Subsidiary. The Board of
Directors may redesignate any Unrestricted Subsidiary to be a Restricted
Subsidiary if that redesignation would not cause a Default.
58
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.
(a) The Company may not, directly or indirectly, consolidate or
merge with or into another Person (whether or not the Company is the surviving
corporation), or sell, assign, transfer, convey or otherwise dispose of all or
substantially all of the properties or assets of the Company and its Restricted
Subsidiaries taken as a whole, in one or more related transactions, to another
Person; unless:
(1) either:
(A) the Company is the surviving corporation; or
(B) the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to
which such sale, assignment, transfer, conveyance or other
disposition has been made is a corporation organized or
existing under the laws of the United States, any state of the
United States or the District of Columbia;
(2) the Person formed by or surviving any such
consolidation or merger (if other than the Company) or the Person to
which such sale, assignment, transfer, conveyance or other disposition
has been made assumes all the obligations of the Company under the
Notes, this Indenture and the Registration Rights Agreement pursuant to
agreements reasonably satisfactory to the Trustee;
(3) immediately after such transaction, no Default or
Event of Default exists; and
(4) the Company or the Person formed by or surviving any
such consolidation or merger (if other than the Company), or to which
such sale, assignment, transfer, conveyance or other disposition has
been made will, on the date of such transaction after giving pro forma
effect thereto and any related financing transactions as if the same
had occurred at the beginning of the applicable four-quarter period, be
permitted to incur at least $1.00 of additional Indebtedness pursuant
to the Debt to Cash Flow Ratio test set forth in Section 4.09(a)
hereof.
(b) In addition, the Company may not, directly or indirectly,
lease all or substantially all of its properties or assets, in one or more
related transactions, to any other Person.
(c) This Section 5.01 will not apply to: (1) a merger of the
Company with an Affiliate solely for the purpose of reincorporating the Company
in another jurisdiction; or (2) any merger or consolidation, or any sale,
transfer, assignment, conveyance, lease or other disposition of assets between
or among the Company and its Restricted Subsidiaries that are Guarantors.
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 Company in a transaction that is subject to, and that complies with the
provisions of, Section 5.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company 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 "Company" shall refer instead to
the successor corporation and not to the
59
Company), and may exercise every right and power of the Company under this
Indenture with the same effect as if such successor Person had been named as the
Company herein; provided, however, that the predecessor Company 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 of the Company's assets in a transaction
that is subject to, and that complies with the provisions of, Section 5.01
hereof.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
Each of the following is an "Event of Default":
(1) the Company defaults in the payment when due of
interest on, or Liquidated Damages with respect to, the Notes, and such
default continues for a period of 30 days;
(2) the Company defaults in the payment when due at
maturity, upon redemption or otherwise of the principal of, or premium,
if any, on the Notes;
(3) the Company or any of its Restricted Subsidiaries
fails to comply with the provisions of Sections 4.07, 4.09, 4.10, 4.15
or 5.01 hereof, and such failure continues for a period of 30 days
after notice to the Company by the Trustee or the Holders of at least
25% in aggregate principal amount of the Notes then outstanding voting
as a single class;
(4) Parent, the Company or any of its Restricted
Subsidiaries fails to observe or perform any other covenant,
representation, warranty or other agreement in this Indenture or the
Notes, and such failure continues for 60 days after notice to the
Company by the Trustee or the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding voting as a single
class;
(5) a default occurs 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 Parent, the
Company or any of its Restricted Subsidiaries (or the payment of which
is guaranteed by Parent, the Company or any of its Restricted
Subsidiaries) whether such Indebtedness or guarantee now exists, or is
created after the date of this Indenture, if that default:
(A) is caused by a failure to pay principal of,
or interest or premium, if any, on such Indebtedness prior to
the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment
Default"); or
(B) results in the acceleration of such
Indebtedness prior to its express maturity,
and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other
such Indebtedness under which there has been a Payment Default
or the maturity of which has been so accelerated, aggregates
$20.0 million or more;
(6) a final judgment or final judgments for the payment
of money are entered by a court or courts of competent jurisdiction
against Parent, the Company or any of its Restricted Subsidiaries,
(other than any such judgments that are fully covered by insurance,
subject to
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ordinary deductibles) which judgment or judgments are not paid,
discharged or stayed for a period of 60 days after such judgment
becomes final; provided that the aggregate amount of all such
undischarged judgments exceeds $20.0 million;
(7) except as permitted by this Indenture, any Note
Guarantee shall be held in any judicial proceeding to be unenforceable
or invalid or shall cease for any reason to be in full force and effect
or any Guarantor, or any Person acting on behalf of any Guarantor,
shall deny or disaffirm its obligations under its Note Guarantee;
(8) Parent, the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken together, would constitute a
Significant Subsidiary, pursuant to or within the meaning of Bankruptcy
Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief
against it in an involuntary case,
(C) consents to the appointment of a custodian
of it or for all or substantially all of its property,
(D) makes a general assignment for the benefit
of its creditors, or
(E) generally is not paying its debts as they
become due; or
(9) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against Parent, the Company or
any of its Restricted Subsidiaries that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken
together, would constitute a Significant Subsidiary in an
involuntary case;
(B) appoints a custodian of Parent, the Company
or any of its Restricted Subsidiaries that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken
together, would constitute a Significant Subsidiary or for all
or substantially all of the property of Parent, the Company or
any of its Restricted Subsidiaries that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken
together, would constitute a Significant Subsidiary; or
(C) orders the liquidation of Parent, the
Company or any of its Restricted Subsidiaries that is a
Significant Subsidiary or any group of Restricted Subsidiaries
that, taken together, would constitute a Significant
Subsidiary ;
and the order or decree remains unstayed and in effect for 60
consecutive days.
Section 6.02 Acceleration.
In the case of an Event of Default specified in clause (8) or (9) of
Section 6.01 hereof, with respect to Parent, the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken together, would constitute a Significant
Subsidiary, all outstanding Notes will become due and payable immediately
without further action or notice. If any
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other 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.
Upon any such declaration, the Notes shall become due and payable
immediately.
Subject to the provisions of Section 7.01 hereof, in case an Event of
Default occurs and is continuing, the Trustee will be under no obligation to
exercise any of the rights or powers under this Indenture at the request or
direction of any Holders of Notes unless such Holders have offered to the
Trustee reasonable indemnity or security against any loss, liability or expense
.. Except to enforce the right to receive payment of principal, premium (if any)
or interest when due, no Holder of a Note may pursue any remedy with respect to
this Indenture or the Notes unless:
(1) such Holder has previously given the Trustee notice
that an Event of Default is continuing;
(2) Holders of at least 25% in aggregate principal amount
of the outstanding Notes have requested the Trustee to pursue the
remedy;
(3) such Holders have offered the Trustee reasonable
security or indemnity against any loss, liability or expense;
(4) the Trustee has not complied with such request within
60 days after the receipt thereof and the offer of security or
indemnity; and
(5) Holders of a majority in aggregate principal amount
of the outstanding Notes have not given the Trustee a direction
inconsistent with such request within such 60-day period.
The Holders of a majority in aggregate principal amount of the then
outstanding Notes by written notice to the Trustee may, on behalf of all of the
Holders, rescind an acceleration or waive any existing Default or Event of
Default and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, interest or premium or Liquidated Damages, if any, that has become
due solely because of the acceleration) have been cured or waived.
If an Event of Default occurs on or after August 15, 2008 by reason of
any willful action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding payment of the premium that the Company
would have had to pay if the Company then had elected to redeem the Notes
pursuant to Section 3.07 hereof, then, upon acceleration of the Notes, an
equivalent premium shall also become and be immediately due and payable, to the
extent permitted by law, anything in this Indenture or in the Notes to the
contrary notwithstanding. If an Event of Default occurs prior to August 15, 2008
by reason of any willful action (or inaction) taken (or not taken) by or on
behalf of the Company with the intention of avoiding the prohibition on
redemption of the Notes prior to such date, then, upon acceleration of the
Notes, an additional premium shall also become and be immediately due and
payable, to the extent permitted by law, in an amount, for each of the years
beginning on August 15 of the years set forth below, as set forth below
(expressed as a percentage of the principal amount of the Notes on the date of
payment that would otherwise be due but for the provisions of this sentence):
YEAR PERCENTAGE
---- ----------
2003.................................. 11.750%
2004.................................. 10.675%
2005.................................. 9.500%
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YEAR PERCENTAGE
---- ----------
2006.................................. 8.225%
2007.................................. 7.050%
Upon becoming aware off any Default or Event of Default, the Company is
required to deliver to the Trustee a statement specifying such Default or Event
of Default.
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 and Liquidated
Damages, 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.
Section 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by 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 a continuing Default or Event of Default in the
payment of the principal of, premium and Liquidated Damages, if any, or interest
on, the Notes (including in connection with an offer to purchase); provided,
however, that the Holders of a majority in aggregate principal amount of the
then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration.
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 that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.
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:
(1) such Holder has previously given the Trustee notice
that an Event of Default is continuing;
(2) Holders of at least 25% in aggregate principal amount
of the outstanding Notes have requested the Trustee to pursue the
remedy;
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(3) such Holders have offered the Trustee reasonable
security or indemnity against any loss, liability or expense;
(4) the Trustee has not complied with such request within
60 days after the receipt thereof and the offer of security or
indemnity; and
(5) Holders of a majority in aggregate principal amount
of the outstanding Notes have not given the Trustee a direction
inconsistent with such request within such 60-day period.
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 Liquidated
Damages, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), 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(1) or (2) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, 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 Company
(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,
expenses and liabilities incurred, and all advances made, by the
Trustee and the costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on
the Notes for principal, premium and Liquidated Damages, if any, and
interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for principal,
premium and Liquidated Damages, if any and interest, respectively; and
Third: to the Company or to such party as a court of
competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes 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, 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 will 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, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee will 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
(2) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture.
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However, the Trustee will examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph
(b) of this Section 7.01;
(2) the Trustee will not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent
facts; and
(3) the Trustee will 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), and (c) of this Section 7.01.
(e) No provision of this Indenture will require the Trustee to
expend or risk its own funds or incur any liability. The Trustee will be under
no obligation to exercise any of its rights and powers under this Indenture at
the request of any Holders, unless such Holder has offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee will not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company .
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
Section 7.02 Rights of Trustee.
(a) The Trustee may conclusively rely upon any document believed
by it to be genuine and to have been signed or presented by the proper Person.
The Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both. The Trustee
will not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may
consult with counsel and the written advice of such counsel or any Opinion of
Counsel will 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 will
not be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee will 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.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company will be sufficient if
signed by an Officer of the Company.
(f) The Trustee will 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 have offered to
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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.
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 Company or any
Affiliate of the Company 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 (if the Indenture has been qualified under the
TIA) or resign. 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 will 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 Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it will not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it will 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 if it is
known to the Trustee, the Trustee will mail to Holders of Notes a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium or
Liquidated Damages, 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 interests of the Holders
of the Notes.
Section 7.06 Reports by Trustee to Holders of the Notes.
(a) 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 will mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA Section 313(a) (but if no
event described in TIA Section 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
will comply with TIA Section 313(b)(2). The Trustee will also transmit by mail
all reports as required by TIA Section 313(c).
(b) A copy of each report at the time of its mailing to the
Holders of Notes will be mailed by the Trustee to the Company and filed by the
Trustee with the SEC and each stock exchange on which the Notes are listed in
accordance with TIA Section 313(d). The Company will promptly notify the Trustee
when the Notes are listed on any stock exchange.
Section 7.07 Compensation and Indemnity.
(a) The Company will pay to the Trustee from time to time
reasonable compensation for its acceptance of this Indenture and services
hereunder. The Trustee's compensation will not be limited by any law on
compensation of a trustee of an express trust. The Company will reimburse the
Trustee promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in
67
addition to the compensation for its services. Such expenses will include the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
(b) The Company and the Guarantors will indemnify the Trustee
against any and all losses, liabilities or expenses incurred by it arising out
of or in connection with the acceptance or administration of its duties under
this Indenture, including the costs and expenses of enforcing this Indenture
against the Company and the Guarantors (including this Section 7.07) and
defending itself against any claim (whether asserted by the Company, the
Guarantors, 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
or bad faith. The Trustee will notify the Company promptly of any claim for
which it may seek indemnity. Failure by the Trustee to so notify the Company
will not relieve the Company or any of the Guarantors of their obligations
hereunder. The Company or such Guarantor will defend the claim and the Trustee
will cooperate in the defense. The Trustee may have separate counsel and the
Company will pay the reasonable fees and expenses of such counsel. Neither the
Company nor any Guarantor need pay for any settlement made without its consent,
which consent will not be unreasonably withheld.
(c) The obligations of the Company and the Guarantors under this
Section 7.07 will survive the satisfaction and discharge of this Indenture.
(d) To secure the Company's and the Guarantors' payment
obligations in this Section 7.07, the Trustee will have a Lien prior to the
Notes on all money or property held or collected by the Trustee, except that
held in trust to pay principal and interest on particular Notes. Such Lien will
survive the satisfaction and discharge of this Indenture.
(e) When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(8) or (9) 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.
(f) The Trustee will comply with the provisions of TIA Section
313(b)(2) to the extent applicable.
Section 7.08 Replacement of Trustee.
(a) A resignation or removal of the Trustee and appointment of a
successor Trustee will become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.
(b) The Trustee may resign in writing at any time and be
discharged from the trust hereby created by so notifying the Company. The
Holders of a majority in principal amount of the then outstanding Notes may
remove the Trustee by so notifying the Trustee and the Company in writing. The
Company may remove the Trustee if.
(1) the Trustee fails to comply with Section 7.10
hereof;
(2) 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;
(3) a custodian or public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
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(c) If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company will 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
Company.
(d) If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company, or the Holders of at least 10% in principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(e) If the Trustee, after written request by any Holder who has
been a Holder for at least six months, fails to comply with Section 7.10
hereof, such Holder may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
(f) A successor Trustee will deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee will become effective, and the
successor Trustee will have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee will mail a notice of its succession
to Holders. The retiring Trustee will promptly transfer. all property held by
it as Trustee to the successor Trustee, provided 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 Company's obligations under Section 7.07 hereof will 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 will be the successor Trustee.
Section 7.10 Eligibility; Disqualification.
There will 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 $100.0
million as set forth in its most recent published annual report of condition.
This Indenture will always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1),(2) and(5). The Trustee is subject to TIA
Section 310(b).
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
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ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at its option and at any time, elect to have either
Section 8.02 or 8.03 hereof be applied with respect to all outstanding Notes
and all outstanding Note Guarantees upon compliance with the conditions set
forth below in this Article 8.
Section 8.02 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and each of the Guarantors will,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be deemed to have been discharged from their obligations with respect to all
outstanding Notes (including the Note Guarantees) on the date the conditions set
forth below are satisfied (hereinafter, "Legal Defeasance"). For this purpose,
Legal Defeasance means that the Company and the Guarantors will be deemed to
have paid and discharged the entire Indebtedness represented by the outstanding
Notes (including the Note Guarantees), which will 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 clauses (1) and (2) below, and to have
satisfied all their other obligations under such Notes, the Note Guarantees and
this Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following provisions which will survive until otherwise terminated or discharged
hereunder:
(1) the rights of Holders of outstanding Notes to receive
payments in respect of the principal of, or interest or premium and
Liquidated Damages, if any, on such Notes when such payments are due
from the trust referred to in Section 8.04 hereof;
(2) the Company's obligations with respect to such Notes
under Article 2 and Section 4.02 hereof;
(3) the rights, powers, trusts, duties and immunities of
the Trustee hereunder and the Company's and the Guarantors' obligations
in connection therewith; and
(4) this Article 8.
Subject to compliance with this Article 8, the Company 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 Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and each of the Guarantors will,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be released from each of their obligations under the covenants contained in
Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18 and
4.19 hereof and clause (4) of Section 5.01 hereof with respect to the
outstanding Notes on and after the date the conditions set forth in Section 8.04
hereof are satisfied (hereinafter, "Covenant Defeasance"), and the Notes will
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 will continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes will not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with
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respect to the outstanding Notes and Note Guarantees, the Company and the
Guarantors may omit to comply with and will 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 will 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 and Note
Guarantees will be unaffected thereby. In addition, upon the Company's exercise
under Section 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
Sections 6.01(3) through 6.01(5) hereof will not constitute Events of Default.
Section 8.04 Conditions to Legal or Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant Defeasance
under either Section 8.02 or 8.03 hereof:
(1) the Company must irrevocably deposit with the
Trustee, in trust, for the benefit of the Holders of the Notes, cash in
U.S. dollars, non-callable Government Securities, or a combination of
cash in U.S. dollars and non-callable Government Securities, in such
amounts as will be sufficient, in the opinion of a nationally
recognized investment bank, appraisal firm or firm of independent
public accountants to pay the principal of, or interest and premium and
Liquidated Damages, if any, on the outstanding Notes on the stated date
for payment thereof or on the applicable redemption date, as the case
may be, and the Company must specify whether the Notes are being
defeased to such stated date for payment or to a particular redemption
date;
(2) in the case of an election under Section 8.02 hereof,
the Company must deliver to the Trustee an Opinion of Counsel
confirming that:
(A) the Company 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 will confirm that, the Holders of the
outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not
occurred;
(3) in the case of an election under Section 8.03 hereof,
the Company must deliver to the Trustee an Opinion of Counsel
confirming that the Holders of the outstanding Notes will not recognize
income, gain or loss for federal income tax purposes as a result of
such Covenant Defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would
have been the case if such Covenant Defeasance had not occurred;
(4) no Default or Event of Default has occurred and is
continuing on the date of such deposit (other than a Default or Event
of Default resulting from the borrowing of funds to be applied to such
deposit) and the deposit will not result in a breach or violation of,
or constitute a default under, any other instrument to which the
Company or any Guarantor is a party or by which the Company or any
Guarantor is bound;
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(5) such Legal Defeasance or Covenant Defeasance will 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 Company or any of its Subsidiaries is a party or by which the
Company or any of its Subsidiaries is bound;
(6) the Company must deliver to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with
the intent of preferring the Holders of Notes over the other creditors
of the Company with the intent of defeating, hindering, delaying or
defrauding any other creditors of the Company or others; and
(7) the Company must deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel, which opinion may be subject to
customary exclusions, each stating that all conditions precedent
provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
Section 8.05 Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (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
will 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 Company 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 and Liquidated Damages, if
any, and interest, but such money need not be segregated from other funds except
to the extent required by law.
The Company will pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
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.
Notwithstanding anything in this Article 8 to the contrary, the Trustee
will deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government 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(1) 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 Company.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, premium or
Liquidated Damages, if any, or interest on any Note and remaining unclaimed for
two years after such principal, premium or Liquidated Damages, if any, or
interest has become due and payable shall be paid to the Company on its request
or (if then held by the Company) will be discharged from such trust; and the
Holder of such Note will thereafter be permitted to look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, will thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and
00
Xxx Xxxx Xxxxxx Journal (national edition), notice that such money remains
unclaimed and that, after a date specified therein, which will not be less than
30 days from the date of such notification or publication, any unclaimed balance
of such money then remaining will be repaid to the Company.
Section 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's and the Guarantors' obligations under this
Indenture and the Notes and the Note Guarantees will be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until
such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 8.02 or 8.03 hereof, as the case may be; provided,
however, that, if the Company makes any payment of principal of, premium or
Liquidated Damages, if any, or interest on any Note following the reinstatement
of its obligations, the Company will be subrogated to the rights of the Holders
of such Notes to receive such payment from the money held by the Trustee or
Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture, the Notes or
the Note Guarantees without the consent of any Holder of Notes:
(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or
in place of certificated Notes;
(3) to provide for the assumption of the Company's or a
Guarantor's obligations to the Holders of Notes and the Note Guarantees
in the case of a merger or consolidation or sale of all or
substantially all of the Company's or such Guarantor's assets, as
applicable;
(4) to make any change that would provide any additional
rights or benefits to the Holders of Notes or that does not adversely
affect the legal rights hereunder of any such Holder;
(5) to comply with requirements of the SEC in order to
effect or maintain the qualification of this Indenture under the TIA;
or
(6) to conform the text of this Indenture or the Notes to
any provision of the "Description of Notes" section of the Company's
Offering Memorandum dated August 7, 2003, relating to the initial
offering of the Notes, to the extent that such provision in that
"Description of Notes" was intended to be a verbatim recitation of a
provision of this Indenture, the Note Guarantees or the Notes.
Upon the request of the Company 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 will join with the Company and the Guarantors in the
execution of any amended or supplemental indenture authorized or permitted by
the
73
terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee will 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, the Company and the
Trustee may amend or supplement this Indenture (including, without limitation,
Section 3.09, 4.10 and 4.15 hereof), the Note Guarantees and the Notes with the
consent of the Holders of at least a majority in principal amount of the Notes
(including, without limitation, Additional Notes, if any) then outstanding
voting as a single class (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for Notes),
and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of
Default or compliance with any provision of this Indenture, the Note Guarantees
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, without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for Notes).
Upon the request of the Company 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 of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee will
join with the Company and the Guarantors 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 will not be
obligated to, enter into such amended or supplemental indenture.
It is not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it is sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company will mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, will 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 Company with any provision of this Indenture, the Notes or the
Note Guarantees. 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):
(1) reduce the principal amount of Notes whose Holders
must consent to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity
of any Note or alter the provisions with respect to the redemption of
the Notes (other than provisions with respect to Sections 3.09, 4.10
and 4.15 hereof);
(3) reduce the rate of or change the time for payment of
interest on any Note;
(4) waive a Default or Event of Default in the payment of
principal of, or premium, or Liquidated Damages, if any, or interest on
the Notes (except a rescission of acceleration of the
74
Notes by the Holders of at least a majority in aggregate principal
amount of the then outstanding Notes and a waiver of the payment
default that resulted from such acceleration);
(5) make any Note payable in money other than that stated
in the Notes;
(6) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes
to receive payments of principal of, or interest or premium or
Liquidated Damages, if any, on the Notes;
(7) waive a redemption payment with respect to any Note
(other than a payment required by Sections 3.09, 4.10 or 4.15 hereof);
(8) release any Guarantor from any of its obligations
under its Note Guarantee or this Indenture, except in accordance with
the terms of this Indenture; or
(9) make any changes to Sections 6.04 or 6.07 hereof or
the preceding amendment and waiver provisions.
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes will be
set forth in a amended or supplemental indenture that complies with the TIA as
then in effect.
Section 9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note 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 of a
Note 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 in accordance
with its terms and thereafter binds every Holder.
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 Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note will not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06 Trustee to Sign Amendments, etc.
The Trustee will 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 Company
may not sign an amended or supplemental indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
will be entitled to receive and (subject to Section 7.01 hereof) will be fully
protected in relying upon, in addition to the documents required by Section
12.04 hereof, an Officers' Certificate and an Opinion of Counsel stating
75
that the execution of such amended or supplemental indenture is authorized or
permitted by this Indenture.
ARTICLE 10.
NOTE GUARANTEES
Section 10.01 Guarantees.
(a) Subject to this Article 10, each of the Guarantors hereby,
jointly and severally, unconditionally guarantees 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 or the obligations of the Company hereunder or thereunder, that:
(1) the principal of, premium and Liquidated Damages, if
any, and interest on the Notes will be promptly paid in full when due,
whether at maturity, by acceleration, redemption or otherwise, and
interest on the overdue principal of and interest on the Notes, if any,
if lawful, and all other obligations of the Company to the Holders or
the Trustee hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and
(2) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that same will
be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
Failing payment when due of any amount so guaranteed or any performance
so guaranteed for whatever reason, the Guarantors will be jointly and severally
obligated to pay the same immediately. Each Guarantor agrees that this is a
guarantee of payment and not a guarantee of collection.
(b) The Guarantors hereby agree that their obligations hereunder
are 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 of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that this Note Guarantee will not be discharged except by complete
performance of the obligations contained in the Notes and this Indenture.
(c) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors or any custodian, trustee,
liquidator or other similar official acting in relation to either the Company or
the Guarantors, any amount paid by either to the Trustee or such Holder, this
Note Guarantee, to the extent theretofore discharged, will be reinstated in full
force and effect.
(d) Each Guarantor agrees that it will not be entitled to any
right of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
Each Guarantor further agrees that, as between the Guarantors, on the one hand,
and the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Note Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (2) in the event of any declaration of acceleration of
such obligations as provided
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in Article 6 hereof, such obligations (whether or not due and payable) will
forthwith become due and payable by the Guarantors for the purpose of this Note
Guarantee. The Guarantors will have the right to seek contribution from any
non-paying Guarantor so long as the exercise of such right does not impair the
rights of the Holders under the Note Guarantee.
Section 10.02 Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Note Guarantee of
such 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 Guarantee. To effectuate the foregoing intention, the Trustee, the Holders
and the Guarantors hereby irrevocably agree that the obligations of such
Guarantor will be limited to the maximum amount that will, after giving effect
to such maximum amount and all other contingent and fixed liabilities of such
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 Guarantor in respect of the obligations of such other
Guarantor under this Article 10, result in the obligations of such Guarantor
under its Note Guarantee not constituting a fraudulent transfer or conveyance.
Section 10.03 Execution and Delivery of Note Guarantee.
To evidence its Note Guarantee set forth in Section 10.01 hereof, each
Guarantor hereby agrees that a notation of such Note Guarantee substantially in
the form attached as Exhibit E hereto will be endorsed by an Officer of such
Guarantor on each Note authenticated and delivered by the Trustee and that this
Indenture will be executed on behalf of such Guarantor by one of its Officers.
Each Guarantor hereby agrees that its Note Guarantee set forth in
Section 10.01 hereof will remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
If an Officer whose signature is on this Indenture or on the Note
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Note Guarantee is endorsed, the Note Guarantee will be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, will constitute due delivery of the Note Guarantee set forth
in this Indenture on behalf of the Guarantors.
In the event that the Company or any of its Restricted Subsidiaries
creates or acquires any Domestic Subsidiary after the date of this Indenture, if
required by Section 4.18 hereof, then that newly acquired or created Domestic
Subsidiary will comply with the provisions of Section 4.18 hereof and this
Article 10, to the extent applicable.
Section 10.04 Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 10.05, no Guarantor may sell or
otherwise dispose of all or substantially all of its assets to, or consolidate
with or merge with or into (whether or not such Guarantor is the surviving
Person) another Person, other than the Company or another Guarantor, unless:
(1) immediately after giving effect to such transaction,
no Default or Event of Default exists; and
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(2) either:
(a) subject to Section 10.05 hereof, the Person
acquiring the property in any such sale or disposition or the Person
formed by or surviving any such consolidation or merger unconditionally
assumes all the obligations of that Guarantor, pursuant to a
supplemental indenture in form and substance reasonably satisfactory to
the Trustee, under this Indenture and the Note Guarantee on the terms
set forth herein or therein; and
(b) the Net Proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of
this Indenture, including without limitation, Section 4.10 hereof.
In 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 satisfactory in form to the Trustee, of the Note
Guarantee 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 Guarantor,
such successor Person will succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Note Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Note
Guarantees so issued will in all respects have the same legal rank and benefit
under this Indenture as the Note Guarantees theretofore and thereafter issued in
accordance with the terms of this Indenture as though all of such Note
Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes will prevent any consolidation or merger of a Guarantor with or into the
Company or another Guarantor, or will prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety to the
Company or another Guarantor.
Section 10.05 Releases.
(a) In the event of any sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all of the Capital
Stock of any Guarantor, in each case to a Person that is not (either before or
after giving effect to such transactions) the Company or a Restricted Subsidiary
of the Company, then such Guarantor (in the event of a sale or other
disposition, by way of merger, consolidation or otherwise, of all of the Capital
Stock of such Guarantor) or the corporation acquiring the property (in the event
of a sale or other disposition of all or substantially all of the assets of such
Guarantor) will be released and relieved of any obligations under its Note
Guarantee; provided that the Net Proceeds of such sale or other disposition are
applied in accordance with the applicable provisions of this Indenture,
including without limitation Section 4.10 hereof. Upon delivery by the Company
to the Trustee of an Officers' Certificate and an Opinion of Counsel to the
effect that such sale or other disposition was made by the Company in accordance
with the provisions of this Indenture, including without limitation Section 4.10
hereof, the Trustee will execute any documents reasonably required in order to
evidence the release of any Guarantor from its obligations under its Note
Guarantee.
(b) Upon designation of any Guarantor as an Unrestricted
Subsidiary in accordance with the terms of this Indenture, such Guarantor will
be released and relieved of any obligations under its Note Guarantee.
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(c) Upon Legal Defeasance in accordance with Article 8 hereof or
satisfaction and discharge of this Indenture in accordance with Article 11
hereof, each Guarantor will be released and relieved of any obligations under
its Note Guarantee.
(d) In the event that any Foreign Subsidiary that is a Guarantor
no longer guarantees or otherwise directly or indirectly provides credit support
for any Indebtedness of the Company or any of its Domestic Subsidiaries, such
Guarantor will be released and relieved of any obligations under its Note
Guarantee. Upon delivery by the Company to the Trustee of an Officers'
Certificate to the effect of the foregoing, the Trustee will execute any
documents reasonably required in order to evidence the release of such Guarantor
from its obligations under its Note Guarantee.
Any Guarantor not released from its obligations under its Note
Guarantee as provided in this Section 10.05 will remain liable for the full
amount of principal of and interest on the Notes and for the other obligations
of any Guarantor under this Indenture as provided in this Article 10.
ARTICLE 11.
SATISFACTION AND DISCHARGE
Section 11.01 Satisfaction and Discharge.
This Indenture will be discharged and will cease to be of further
effect as to all Notes issued hereunder, when:
(1) either:
(a) all Notes that have been authenticated,
except lost, stolen or destroyed Notes that have been replaced or paid
and Notes for whose payment money has been deposited in trust and
thereafter repaid to the Company, have been delivered to the Trustee
for cancellation; or
(b) all Notes that have not been delivered to
the Trustee for cancellation have become due and payable by reason of
the mailing of a notice of redemption or otherwise or will become due
and payable within one year and the Company or any Guarantor has
irrevocably deposited or caused to be deposited with the Trustee as
trust funds in trust solely for the benefit of the Holders, cash in
U.S. dollars, non-callable Government Securities, or a combination of
cash in U.S. dollars and non-callable Government Securities, in such
amounts as will be sufficient, without consideration of any
reinvestment of interest, to pay and discharge the entire Indebtedness
on the Notes not delivered to the Trustee for cancellation for
principal, premium and Liquidated Damages, if any, and accrued interest
to the date of maturity or redemption;
(2) no Default or Event of Default has occurred and is
continuing on the date of the deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such
deposit) and the deposit will not result in a breach or violation of,
or constitute a default under, any other instrument to which the
Company or any Guarantor is a party or by which the Company or any
Guarantor is bound;
(3) the Company or any Guarantor has paid or caused to be
paid all sums payable by it under this Indenture; and
(4) the Company has delivered irrevocable instructions to
the Trustee under this Indenture to apply the deposited money toward
the payment of the Notes at maturity or the redemption date, as the
case may be.
79
In addition, the Company must deliver an Officers' Certificate and an Opinion of
Counsel to the Trustee, which opinion may be subject to customary assumptions
and exclusions, stating that all conditions precedent to satisfaction and
discharge have been satisfied.
Notwithstanding the satisfaction and discharge of this Indenture, if
money has been deposited with the Trustee pursuant to subclause (b) of clause
(1) of this Section, the provisions of Sections 11.02 and 8.06 will survive. In
addition, nothing in this Section 11.01 will be deemed to discharge those
provisions of Section 7.07 hereof, that, by their terms, survive the
satisfaction and discharge of this Indenture.
Section 11.02 Application of Trust Money.
Subject to the provisions of Section 8.06 hereof, all money deposited
with the Trustee pursuant to Section 11.01 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law.
If the Trustee or Paying Agent is unable to apply any money or
Government Securities in accordance with Section 11.01 hereof by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's and any Guarantor's obligations under this Indenture
and the Notes shall be revived and reinstated as though no deposit had occurred
pursuant to Section 11.01 hereof; provided that if the Company has made any
payment of principal of, premium, if any, or interest on any Notes because of
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the money or
Government Securities held by the Trustee or Paying Agent.
ARTICLE 12.
MISCELLANEOUS
Section 12.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA Section 318(c), the imposed duties will control.
Section 12.02 Notices.
Any notice or communication by the Company, any Guarantor 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),
telex, telecopier or overnight air courier guaranteeing next day delivery, to
the others' address:
If to the Company and/or any Guarantor:
Haights Cross Operating Company
c/o Haights Cross Communications, Inc.
00 Xxx Xxxx Xxxxxx, Xxxxx 000
00
Xxxxx Xxxxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Chief Financial Officer
With a copy to:
Xxxxxxx Procter LLP
00 Xxxxx Xxxxxx
Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx
Telecopier No.: (000) 000-0000
Attention: Xxxxx X. Xxxxx, P.C.
If to the Trustee:
Xxxxx Fargo Bank Minnesota, N.A.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Officer
The Company, any Guarantor 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) will
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder will be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication will also be so mailed to any
Person described in TIA Section 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it will
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it will mail
a copy to the Trustee and each Agent at the same time.
Section 12.03 Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).
81
Section 12.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee (which must include the
statements set forth in Section 12.05 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
(2) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee (which must include the
statements set forth in Section 12.05 hereof) stating that, in the
opinion of such counsel, all such conditions precedent and covenants
have been satisfied.
Section 12.05 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 Section 314(a)(4) must comply with the provisions of TIA Section
314(e) and must include:
(1) a statement that the Person making such certificate
or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he
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
(4) a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been satisfied.
Section 12.06 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 12.07 No Personal Liability of Directors, Officers, Employees and
Stockholders.
No director, officer, employee, incorporator or stockholder of the
Company or any Guarantor, as such, will have any liability for any obligations
of the Company or the Guarantors under the Notes, this Indenture, the Note
Guarantees, or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes. The waiver may not be effective to
waive liabilities under the federal securities laws.
Section 12.08 Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES WITHOUT
82
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 12.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 12.10 Successors.
All agreements of the Company in this Indenture and the Notes will bind
its successors. All agreements of the Trustee in this Indenture will bind its
successors. All agreements of each Guarantor in this Indenture will bind its
successors, except as otherwise provided in Section 10.05.
Section 12.11 Severability.
In case any provision in this Indenture or in the Notes is invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions will not in any way be affected or impaired thereby.
Section 12.12 Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each
signed copy will be an original, but all of them together represent the same
agreement.
Section 12.13 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 will in no
way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
83
SIGNATURES
Dated as of August 20, 2003
HAIGHTS CROSS OPERATING COMPANY
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxx
Title: Executive Vice President and
Chief Financial Officer
HAIGHTS CROSS COMMUNICATIONS, INC.
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxx
Title: Executive Vice President and
Chief Financial Officer
SUNDANCE/NEWBRIDGE EDUCATIONAL PUBLISHING, LLC
CHELSEA HOUSE PUBLISHERS, LLC
RECORDED XXXXX, XXX
TRIUMPH LEARNING, LLC
OAKSTONE PUBLISHING, LLC
THE CORIOLIS GROUP, LLC
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
XX XXXXX LIMITED
By: /s/ XXXXXX XXXXX
-------------------------------------
Name: XXXXXX XXXXX
Title: COMPANY SECRETARY.
XXXXX FARGO BANK MINNESOTA, N.A., as Trustee
By: /s/ Xxxxxx X. X'Xxxxxxx
-------------------------------------
Name: Xxxxxx X. X'Xxxxxxx
Title: Corporate Trust Officer
Indenture
EXHIBIT A1
[Face of Note]
================================================================================
CUSIP/CINS____________
11 3/4% Senior Notes due 2011
No._________ $____________
HAIGHTS CROSS OPERATING COMPANY
promises to pay to_______________ or registered assigns,
the principal sum of___________________________________________________ DOLLARS
on August 15, 2011.
Interest Payment Dates: February 15 and August 15
Record Dates: February 1 and August 1
Dated:_____________________, 200__
HAIGHTS CROSS OPERATING COMPANY
By: _____________________________________
Name:
Title:
This is one of the Notes referred to
in the within-mentioned Indenture:
XXXXX FARGO BANK MINNESOTA, N.A.,
as Trustee
By: _______________________________
Authorized Signatory
================================================================================
A1-1
[Back of Note]
11 3/4% Senior Notes due 2011
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
Capitalized terms used herein have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) INTEREST. Haights Cross Operating Company, a Delaware
corporation (the "Company"), promises to pay interest on the principal
amount of this Note at 11 3/4% per annum from____________ until
maturity and shall pay the Liquidated Damages, if any, payable pursuant
to Section 5 of the Registration Rights Agreement referred to below.
The Company will pay interest and Liquidated Damages, if any,
semi-annually in arrears on February 15 and August 15 of each year, or
if any such day is not a Business Day, on the next succeeding Business
Day (each, an "Interest Payment Date"). Interest on the Notes will
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 that if
there is no existing 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; provided,
further, that the first Interest Payment Date shall be_____________.
The Company will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium,
if any, from time to time on demand at a rate that is 1% per annum in
excess of the rate then in effect; it will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest and Liquidated Damages, if any,
(without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. Interest will be computed
on the basis of a 360-day year of twelve 30-day months.
(2) METHOD OF PAYMENT. The Company will pay interest on
the Notes (except defaulted interest) and Liquidated Damages, if any,
to the Persons who are registered Holders of Notes at the close of
business on the February 1 or August 1 next preceding the Interest
Payment Date, even if such Notes are canceled 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 will be payable as to principal, premium, Liquidated Damages, if
any, and interest at the office or agency of the Company maintained for
such purpose within or without the City and State of New York, or, at
the option of the Company, payment of interest and Liquidated Damages,
if any, 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 will be required with respect
to principal of and interest, premium and Liquidated Damages, if any,
on, all Global Notes and all other Notes the Holders of which will have
provided wire transfer instructions to the Company or the Paying Agent.
Such payment will 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, Xxxxx Fargo
Bank Minnesota, N.A., the Trustee under the Indenture, will act as
Paying Agent and Registrar. The Company may change any Paying Agent or
Registrar without notice to any Holder. The Company or any of its
Subsidiaries may act in any such capacity.
A1-2
(4) INDENTURE. The Company issued the Notes under an
Indenture dated as of August 20, 2003 (the "Indenture") among the
Company, the Guarantors and the Trustee. The terms of the Notes include
those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S. Code Sections
77aaa-77bbbb) as in effect on the date on which the Indenture is
qualified thereunder. The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture
shall govern and be controlling. The Notes are unsecured obligations of
the Company.
(5) OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) of
this Paragraph 5, the Company will not have the option to redeem all or
part of the Notes prior to August 15, 2008. On or after August 15,
2008, the Company will have the option to redeem the Notes upon not
less than 10 nor more than 60 days' notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages, if any, on the
Notes redeemed, to the applicable redemption date, if redeemed during
the twelve-month period beginning on August 15 of the years indicated
below:
Year Percentage
---- ----------
2008......................... 105.8750%
2009......................... 102.9375%
2010 and thereafter.......... 100.0000%
Unless the Company defaults in the payment of the
redemption price, interest will cease to accrue on the Notes or
portions thereof called for redemption on the applicable redemption
date.
(b) Notwithstanding the provisions of
subparagraph (a) of this Paragraph 5, at any time prior to August 15,
2006, the Company may on any one or more occasions redeem Notes at a
redemption price of 111.7500% of the principal amount, plus accrued and
unpaid interest and Liquidated Damages, if any, to the redemption date
with the net cash proceeds of one or more Equity Offerings (provided
that, if the Equity Offering is an offering by Parent, a portion of the
net cash proceeds thereof equal to the amount required to redeem any
such Notes is contributed to the equity capital of the Company or used
to acquire Capital Stock (other than Disqualified Stock) of the
Company;) provided that at least 65% in aggregate principal amount of
the Notes issued under the Indenture (excluding Notes held by the
Company and its Subsidiaries) remains outstanding immediately after the
occurrence of such redemption and that such redemption occurs within 90
days of the date of the closing of such Equity Offering.
(6) MANDATORY REDEMPTION. The Company will not be
required to make mandatory redemption or sinking fund payments with
respect to the Notes.
(7) REPURCHASE AT THE OPTION OF THE HOLDER.
(a) If there is a Change of Control, the Company
will be required to make an offer (a "Change of Control Offer") to
repurchase all or any part (equal to $1,000 or an integral multiple
thereof) of each Holder's Notes at a purchase price equal to 101% of
the aggregate principal amount of Notes repurchased plus accrued and
unpaid interest and Liquidated Damages,
A1-3
if any, on the Notes repurchased, to the date of purchase (the "Change
of Control Payment"). Within 30 days following any Change of Control,
the Company will mail a notice to each Holder setting forth the
procedures governing the Change of Control Offer as required by the
Indenture.
(b) If the Company or a Restricted Subsidiary of
the Company consummates any Asset Sales, within five days of each date
on which the aggregate amount of Excess Proceeds exceeds $10.0 million,
the Company will commence an offer to all Holders of Notes and all
holders of other Indebtedness that is pari passu with the Notes
containing provisions similar to those set forth in the Indenture with
respect to offers to purchase or redeem with the proceeds of sales of
assets (an "Asset Sale Offer") pursuant to Section 3.09 of the
Indenture to purchase the maximum principal amount of Notes (including
any Additional Notes) and other pari passu Indebtedness 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 and Liquidated Damages, if any, to the date of
purchase, and will be payable in cash, in accordance with the
procedures set forth in the Indenture. To the extent that the aggregate
amount of Notes (including any Additional Notes) and other pari passu
Indebtedness tendered pursuant to an Asset Sale Offer is less than the
Excess Proceeds, the Company (or such Restricted Subsidiary) may use
such deficiency for any purpose not otherwise prohibited by the
Indenture. If the aggregate principal amount of Notes and other pari
passu Indebtedness surrendered by holders thereof exceeds the amount of
Excess Proceeds, the Trustee shall select the Notes and other pari
passu Indebtedness to be purchased on a pro rata basis. Holders of
Notes that are the subject of an offer to purchase will receive an
Asset Sale Offer from the Company prior to any related purchase date
and may elect to have such Notes purchased by completing the form
entitled "Option of Holder to Elect Purchase" attached to the Notes.
(8) NOTICE OF REDEMPTION. Notice of redemption will be
mailed at least 10 days but not more than 60 days before the redemption
date to each Holder whose Notes are to be redeemed at its registered
address, except that redemption notices may be mailed more than 60 days
prior to a redemption date if the notice is issued in connection with a
defeasance of the Notes or a satisfaction or discharge of the
Indenture. 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 ceases to accrue on Notes or portions thereof called for
redemption.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and 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 Company may
require a Holder to pay any taxes and fees required by law or permitted
by the Indenture. The Company 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, the Company need not exchange or register the transfer of any
Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the
corresponding Interest Payment Date.
(10) PERSONS DEEMED OWNERS. The registered Holder of a
Note may be treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Notes or the Note Guarantees may be
amended or supplemented with the consent
A1-4
of the Holders of at least a majority in principal amount of the then
outstanding Notes and Additional Notes, if any, voting as a single
class, and any existing Default or Event of Default or compliance with
any provision of the Indenture, the Notes or the Note Guarantees may be
waived with the consent of the Holders of a majority in principal
amount of the then outstanding Notes and Additional Notes, if any,
voting as a single class. Without the consent of any Holder of a Note,
the Indenture, the Notes or Note Guarantees may be amended or
supplemented 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 of the Company's or a Guarantor's
obligations to Holders of the Notes and the Note Guarantees in case of
a merger or consolidation or sale of all or substantially all of the
Company's or such Guarantor's assets, as applicable, to make any change
that would provide any additional rights or benefits to the Holders of
Notes or that does not adversely affect the legal rights under the
Indenture of any such Holder, to comply with the requirements of the
SEC in order to effect or maintain the qualification of the Indenture
under the TIA or to conform the text of the Indenture or the Notes to
any provision of the "Description of Notes" section of the Company's
Offering Memorandum dated August 7, 2003 relating to the initial
offering of the Notes, to the extent that such provision in that
"Description of Notes" was intended to be a verbatim recitation of a
provision of the Indenture, the Note Guarantees or the Notes.
(12) DEFAULTS AND REMEDIES. Events of Default include:
(i) the Company defaults in the payment when due of interest or
Liquidated Damages on the Notes, and such default continues for a
period of 30 days; (ii) the Company defaults in payment when due at
maturity, upon redemption or otherwise of principal of, or premium, if
any, on the Notes; (iii) the Company or any of its Restricted
Subsidiaries fails to comply with Sections 4.07, 4.09, 4.10, 4.15 or
5.01 of the Indenture and such failure continues for a period of 30
days after notice to the Company by the Trustee or the Holders of at
least 25% in principal amount of the Notes then outstanding voting as a
single class; (iv) Parent, the Company or any of its Restricted
Subsidiaries fails to observe or perform any other covenant,
representation, warranty or other agreement in the Indenture or the
Notes, and such failure continues for 60 days after notice to the
Company by the Trustee or the Holders of at least 25% in principal
amount of the Notes then outstanding voting as a single class; (v) a
default occurs 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 Parent, the Company or any of its
Restricted Subsidiaries (or the payment of which is guaranteed by
Parent, the Company or any of its Subsidiaries) whether such
Indebtedness or guarantee now exists, or is created after the date of
the Indenture, if that default: (a) is caused by a failure to pay
principal of, or interest or premium, if any, on such Indebtedness
prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or (b)
results in the acceleration of such Indebtedness prior to its express
maturity, and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $20.0 million or
more; (vi) failure by Parent, the Company or any of its Restricted
Subsidiaries to pay final judgments aggregating in excess of $20.0
million (other than such judgments that are fully covered by insurance,
subject to ordinary deductibles), which judgments are not paid,
discharged or stayed for a period of 60 days after such judgment
becomes final; (vii) except as permitted by the Indenture, any Note
Guarantee shall be held in any judicial proceeding to be unenforceable
or invalid or shall cease for any reason to be in full force and effect
or any Guarantor or any Person acting on its behalf shall deny or
disaffirm its obligations under such Guarantor's Note Guarantee; and
(viii) certain events of bankruptcy or insolvency with respect to
Parent, the Company or any of its Restricted Subsidiaries that is a
Significant Subsidiary or any group of Restricted Subsidiaries that,
taken together, would constitute a Significant Subsidiary. If any Event
of Default occurs and is
A1-5
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. Notwithstanding the foregoing, in the case
of an Event of Default arising from certain events of bankruptcy or
insolvency described in subclause (viii) above, all outstanding Notes
will become due and payable without further action or notice. Holders
may not enforce the Indenture or the Notes except as provided in the
Indenture. Subject to certain limitations, 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. The Holders of a majority in aggregate principal
amount of the Notes then outstanding by notice to the Trustee, may on
behalf of all Holders, waive any existing Default or Event of Default
and its consequences under the Indenture except a continuing Default or
Event of Default in the payment of interest or premium or Liquidated
Damages on, or the principal of, the Notes. The Company is required to
deliver to the Trustee annually a statement regarding compliance with
the Indenture, and the Company is required upon becoming aware of any
Default or Event of Default, to deliver to the Trustee a statement
specifying such Default or Event of Default.
(13) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not
the Trustee.
(14) No RECOURSE AGAINST OTHERS. A director, officer,
employee, incorporator or stockholder, of the Company or any of the
Guarantors, as such, will not have any liability for any obligations of
the Company or such Guarantor under the Notes, the Note Guarantees or
the 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 the issuance of the Notes.
(15) AUTHENTICATION. This Note will not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
(16) 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).
(17) ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL
NOTES AND RESTRICTED DEFINITIVE NOTES. In addition to the rights
provided to Holders of Notes under the Indenture, Holders of Restricted
Global Notes and Restricted Definitive Notes will have all the rights
set forth in the Registration Rights Agreement dated as of August 20,
2003, among the Company, the Guarantors and the other parties named on
the signature pages thereof or, in the case of Additional Notes,
Holders of Restricted Global Notes and Restricted Definitive Notes will
have the rights set forth in one or more registration rights
agreements, if any, among the Company, the Guarantors and the other
parties thereto, relating to rights given by the Company and the
Guarantors to the purchasers of any Additional Notes (collectively, the
"Registration Rights Agreement").
(18) CUSIP NUMBERS. Pursuant to a recommendation
promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP numbers to be
A1-6
printed on the Notes and the Trustee may use CUSIP numbers in notices
of redemption as a convenience to Holders. No representation is made as
to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only
on the other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Haights Cross Operating Company
c/o Haights Cross Communications, Inc.
00 Xxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxx Xxxx 00000
Attention: Chief Financial Officer
A1-7
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: __________________________________
(Insert assignee's legal name)
________________________________________________________________________________
(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 Company. 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*:_______________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A1-8
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
[ ]Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or 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
face of this Note)
Tax Identification No.:_______________________
Signature Guarantee*:________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A1-9
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:
PRINCIPAL AMOUNT
AMOUNT OF DECREASE IN AMOUNT OF INCREASE IN OF THIS GLOBAL NOTE
PRINCIPAL AMOUNT PRINCIPAL AMOUNT FOLLOWING SUCH SIGNATURE OF AUTHORIZED
OF OF DECREASE OFFICER OF TRUSTEE OR
DATE OF EXCHANGE THIS GLOBAL NOTE THIS GLOBAL NOTE (OR INCREASE) CUSTODIAN
---------------- ---------------- ---------------- ------------- ---------
* This schedule should be included only if the Note is issued in global
form.
A1-10
EXHIBIT A2
[Face of Regulation S Temporary Global Note]
================================================================================
CUSIP/CINS _________
11 3/4% Senior Notes due 2011
No. ______ $ _________
HAIGHTS CROSS OPERATING COMPANY
promises to pay to________________or registered assigns,
the principal sum of_____________________________________________________DOLLARS
on August 15, 2011.
Interest Payment Dates: February 15 and August 15
Record Dates: February 1 and August 1
Dated: ________,200_
HAIGHTS CROSS OPERATING COMPANY
By: _______________________________
Name:
Title:
This is one of the Notes referred to
in the within-mentioned Indenture:
XXXXX FARGO BANK MINNESOTA, N.A.,
as Trustee
By: _________________________________
Authorized Signatory
================================================================================
A2-1
Back of Regulation S Temporary Global Note
11 3/4% Senior Notes due 2011
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (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 (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION
PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE
COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("XXX"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE
BENEFIT OF THE ISSUER THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY (1) (a) IN THE UNITED STATES TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (b) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH RULE 904
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UNDER THE SECURITIES ACT, (c) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (d) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501 (a) (1), (2), (3) OR (7) OF THE SECURITIES ACT (AN
"INSTITUTIONAL ACCREDITED INVESTOR")) THAT, PRIOR TO SUCH TRANSFER, FURNISHES
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
(THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN
RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN OPINION
OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH
THE SECURITIES ACT OR (e) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF
COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF
THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE.
Capitalized terms used herein have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) INTEREST. Haights Cross Operating Company, a
Delaware corporation (the "Company"), promises to pay interest on the
principal amount of this Note at 11 3/4% per annum from _____________
until maturity and shall pay the Liquidated Damages, if any, payable
pursuant to Section 5 of the Registration Rights Agreement referred to
below. The Company will pay interest and Liquidated Damages, if any,
semi-annually in arrears on February 15 and August 15 of each year, or
if any such day is not a Business Day, on the next succeeding Business
Day (each, an "Interest Payment Date"). Interest on the Notes will
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 that if
there is no existing 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; provided,
further, that the first Interest Payment Date shall be__________. The
Company will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium,
if any, from time to time on demand at a rate that is 1% per annum in
excess of the rate then in effect; it will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest and Liquidated Damages, if any,
(without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. Interest will be computed
on the basis of a 360-day year of twelve 30-day months.
Until this Regulation S Temporary Global Note is exchanged for one or
more Regulation S Permanent Global Notes, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Note shall in all other respects be entitled
to the same benefits as other Notes under the Indenture.
(2) METHOD OF PAYMENT. The Company will pay interest on
the Notes (except defaulted interest) and Liquidated Damages, if any,
to the Persons who are registered Holders of Notes at the close of
business on the February 1 or August 1 next preceding the Interest
Payment Date, even if such Notes are canceled 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
A2-3
interest. The Notes will be payable as to principal, premium and
Liquidated Damages, if any, and interest at the office or agency of the
Company maintained for such purpose within or without the City and
State of New York, or, at the option of the Company, payment of
interest and Liquidated Damages, if any, 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
will be required with respect to principal of and interest, premium and
Liquidated Damages, if any, on, all Global Notes and all other Notes
the Holders of which will have provided wire transfer instructions to
the Company or the Paying Agent. Such payment will 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, Xxxxx Fargo
Bank Minnesota,N.A., the Trustee under the Indenture, will act as
Paying Agent and Registrar. The Company may change any Paying Agent or
Registrar without notice to any Holder. The Company or any of its
Subsidiaries may act in any such capacity.
(4) INDENTURE. The Company issued the Notes under an
Indenture dated as of August 20, 2003 (the "Indenture") among the
Company, the Guarantors and the Trustee. The terms of the Notes include
those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S. Code Sections
77aaa-77bbbb) as in effect on the date on which the Indenture is
qualified thereunder. The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture
shall govern and be controlling. The Notes are unsecured obligations of
the Company.
(5) OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) of
this Paragraph 5, the Company will not have the option to redeem the
Notes prior to August 15, 2008. On or after August 15, 2008, the
Company will have the option to redeem all or part of the Notes upon
not less than 10 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest and Liquidated Damages, if any, on the
Notes redeemed, to the applicable redemption date, if redeemed during
the twelve-month period beginning on August 15 of the years indicated
below:
Year Percentage
---- ----------
2008................................................................. 105.8750%
2009................................................................. 102.9375%
2010 and thereafter.................................................. 100.0000%
Unless the Company defaults in the payment of the
redemption price, interest will cease to accrue on the Notes or
portions thereof called for redemption on the applicable redemption
date.
(b) Notwithstanding the provisions of
subparagraph (a) of this Paragraph 5, at any time prior to August 15,
2006, the Company may on any one or more occasions redeem Notes at a
redemption price of 111.7500% of the principal amount, plus accrued
and unpaid interest and Liquidated Damages, if any, to the redemption
date with the net cash proceeds of one or more Equity Offerings
(provided that, if the Equity Offering is an offering by Parent, a
portion
A2-4
of the net cash proceeds thereof equal to the amount required to redeem
any such Notes is contributed to the equity capital of the Company or
used to acquire Capital Stock (other than Disqualified Stock) of the
Company; provided that at least 65% in aggregate principal amount of
the Notes issued under the Indenture (excluding Notes held by the
Company and its Subsidiaries) remains outstanding immediately after the
occurrence of such redemption and that such redemption occurs within 90
days of the date of the closing of such Equity Offering.
(6) MANDATORY REDEMPTION. The Company will not be
required to make mandatory redemption or sinking fund payments with
respect to the Notes.
(7) REPURCHASE AT THE OPTION OF THE HOLDER.
(a) If there is a Change of Control, the Company
will be required to make an offer (a "Change of Control Offer") to
repurchase all or any part (equal to $1,000 or an integral multiple
thereof) of each Holder's Notes at a purchase price equal to 101% of
the aggregate principal amount of Notes repurchased plus accrued and
unpaid interest and Liquidated Damages, if any, on the Notes
repurchased, to the date of purchase (the "Change of Control Payment").
Within 30 days following any Change of Control, the Company will mail a
notice to each Holder setting forth the procedures governing the Change
of Control Offer as required by the Indenture.
(b) If the Company or a Restricted Subsidiary of
the Company consummates any Asset Sales, within five days of each date
on which the aggregate amount of Excess Proceeds exceeds $10.0 million,
the Company will commence an offer to all Holders of Notes and all
holders of other Indebtedness that is pari passu with the Notes
containing provisions similar to those set forth in the Indenture with
respect to offers to purchase or redeem with the proceeds of sales of
assets (an "Asset Sale Offer") pursuant to Section 3.09 of the
Indenture to purchase the maximum principal amount of Notes (including
any Additional Notes) and other pari passu Indebtedness 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 and Liquidated Damages, if any, to the date of
purchase, and will be payable in cash, in accordance with the
procedures set forth in the Indenture. To the extent that the aggregate
amount of Notes (including any Additional Notes) and other pari passu
Indebtedness tendered pursuant to an Asset Sale Offer is less than the
Excess Proceeds, the Company (or such Restricted Subsidiary) may use
such deficiency for any purpose not otherwise prohibited by the
Indenture. If the aggregate principal amount of Notes and other pari
passu Indebtedness surrendered by holders thereof exceeds the amount of
Excess Proceeds, the Trustee shall select the Notes and other pari
passu Indebtedness to be purchased on a pro rata basis. Holders of
Notes that are the subject of an offer to purchase will receive an
Asset Sale Offer from the Company prior to any related purchase date
and may elect to have such Notes purchased by completing the form
entitled "Option of Holder to Elect Purchase" attached to the Notes.
(8) NOTICE OF REDEMPTION. Notice of redemption will be
mailed at least 10 days but not more than 60 days before the redemption
date to each Holder whose Notes are to be redeemed at its registered
address, except that redemption notices may be mailed more than 60 days
prior to a redemption date if the notice is issued in connection with a
defeasance of the Notes or a satisfaction or discharge of the
Indenture. 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 ceases to accrue on Notes or portions thereof called for
redemption.
A2-5
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and 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 Company may
require a Holder to pay any taxes and fees required by law or permitted
by the Indenture. The Company 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, the Company need not exchange or register the transfer of any
Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the
corresponding Interest Payment Date.
This Regulation S Temporary Global Note is exchangeable in whole or in
part for one or more Global Notes only (i) on or after the termination of the
40-day restricted period (as defined in Regulation S) and (ii) upon presentation
of certificates (accompanied by an Opinion of Counsel, if applicable) required
by Article 2 of the Indenture. Upon exchange of this Regulation S Temporary
Global Note for one or more Global Notes, the Trustee shall cancel this
Regulation S Temporary Global Note.
(10) PERSONS DEEMED OWNERS. The registered Holder of a
Note may be treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Notes or the Note Guarantees may be
amended or supplemented with the consent of the Holders of at least a
majority in principal amount, of the then outstanding Notes and
Additional Notes, if any, voting as a single class, and any existing
Default or Event of Default or compliance with any provision of the
Indenture, the Notes or the Note Guarantees may be waived with the
consent of the Holders of a majority in principal amount of the then
outstanding Notes and Additional Notes, if any, voting as a single
class. Without the consent of any Holder of a Note, the Indenture, the
Notes or Note Guarantees may be amended or supplemented 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 of the Company's or a Guarantor's obligations to Holders of
the Notes and the Note Guarantees in case of a merger or consolidation
or sale of all or substantially all of the Company's or such
Guarantor's assets, as applicable, to make any change that would
provide any additional rights or benefits to the Holders of Notes or
that does not adversely affect the legal rights under the Indenture of
any such Holder, to comply with the requirements of the SEC in order to
effect or maintain the qualification of the Indenture under the TIA or
to conform the text of the Indenture or the Notes to any provision of
the "Description of Notes" section of the Company's Offering Memorandum
dated August 7, 2003 relating to the initial offering of the Notes, to
the extent that such provision in that "Description of Notes" was
intended to be a verbatim recitation of a provision of the Indenture,
the Note Guarantees or the Notes.
(12) DEFAULTS AND REMEDIES. Events of Default include: (i)
the Company defaults in the payment when due of interest or Liquidated
Damages on the Notes, and such default continues for a period of 30
days; (ii) the Company defaults in payment when due at maturity, upon
redemption or otherwise of principal of, or premium, if any, on the
Notes; (iii) the Company or any of its Restricted Subsidiaries fails to
comply with Sections 4.07, 4.09, 4.10, 4.15 or 5.01 of the Indenture
and such failure continues for a period of 30 days after notice to the
Company by the Trustee or the Holders of at least 25% in principal
amount of the Notes then outstanding voting as a single class; (iv)
Parent, the Company or any of its Restricted Subsidiaries fails to
observe or perform any other covenant, representation, warranty or
other agreement in the
A2-6
Indenture or the Notes, and such failure continues for 60 days after
notice to the Company by the Trustee or the Holders of at least 25% in
principal amount of the Notes then outstanding voting as a single
class; (v) a default occurs 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 Parent, the Company or
any of its Restricted Subsidiaries (or the payment of which is
guaranteed by Parent, the Company or any of its Subsidiaries) whether
such Indebtedness or guarantee now exists, or is created after the date
of the Indenture, if that default: (a) is caused by a failure to pay
principal of, or interest or premium, if any, on such Indebtedness
prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or (b)
results in the acceleration of such Indebtedness prior to its express
maturity, and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $20.0 million or
more; (vi) failure by Parent, the Company or any of its Restricted
Subsidiaries to pay final judgments aggregating in excess of $20.0
million (other than such judgments that are fully covered by insurance,
subject to ordinary deductibles), which judgments are not paid,
discharged or stayed for a period of 60 days after such judgment
becomes final; (vii) except as permitted by the Indenture, any Note
Guarantee shall be held in any judicial proceeding to be unenforceable
or invalid or shall cease for any reason to be in full force and effect
or any Guarantor or any Person acting on its behalf shall deny or
disaffirm its obligations under such Guarantor's Note Guarantee; and
(viii) certain events of bankruptcy or insolvency with respect to
Parent, the Company or any of its Restricted Subsidiaries that is a
Significant Subsidiary or any group of Restricted Subsidiaries that,
taken together, would constitute a Significant Subsidiary. 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. Notwithstanding the
foregoing, in the case of an Event of Default arising from certain
events of bankruptcy or insolvency described in subclause (viii) above,
all outstanding Notes will become due and payable without further
action or notice. Holders may not enforce the Indenture or the Notes
except as provided in the Indenture. Subject to certain limitations,
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. The Holders of a majority in
aggregate principal amount of the Notes then outstanding by notice to
the Trustee, may on behalf of all Holders, waive any existing Default
or Event of Default and its consequences under the Indenture except a
continuing Default or Event of Default in the payment of interest or
premium or Liquidated Damages on, or the principal of, the Notes. The
Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture, and the Company is required
upon becoming aware of any Default or Event of Default, to deliver to
the Trustee a statement specifying such Default or Event of Default.
(13) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not
the Trustee.
(14) No RECOURSE AGAINST OTHERS. A director, officer,
employee, incorporator or stockholder, of the Company or any of the
Guarantors, as such, will not have any liability for any obligations of
the Company or such Guarantor under the Notes, the Note Guarantees or
the Indenture or for any claim based on, in respect of, or by reason
of, such obligations or their
A2-7
creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the
issuance of the Notes.
(15) AUTHENTICATION. This Note will not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
(16) 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) .
(17) ADDITIONAL RIGHTS OF HOLDERS. In addition to the
rights provided to Holders of Notes under the Indenture, Holders of
this Regulation S Temporary Global Note will have all the rights set
forth in the Registration Rights Agreement dated as of August 20, 2003,
among the Company, the Guarantors and the other parties named on the
signature pages thereof or, in the case of Additional Notes, Holders
thereof will have the rights set forth in one or more registration
rights agreements, if any, among the Company, the Guarantors and the
other parties thereto, relating to rights given by the Company and the
Guarantors to the purchasers of any Additional Notes (collectively, the
"Registration Rights Agreement").
(18) CUSIP NUMBERS. Pursuant to a recommendation
promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP numbers to be printed on the
Notes and the Trustee may use CUSIP numbers in notices of redemption as
a convenience to Holders. No representation is made as to the accuracy
of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Haights Cross Operating Company
c/o Haights Cross Communications, Inc.
00 Xxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxx Xxxx 00000
Attention: Chief Financial Officer
A2-8
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: __________________________________
(Insert assignee's legal name)
________________________________________________________________________________
(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 Company. 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*: ___________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A2-9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or 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 face of this Note)
Tax Identification No.:___________________
Signature Guarantee*: ____________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A2-10
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary Global
Note for an interest in another Global Note, or exchanges of a part of another
other Restricted Global Note for an interest in this Regulation S Temporary
Global Note, have been made:
Principal Amount
Amount of decrease in Amount of increase in of this Global Note
Principal Amount Principal Amount following such Signature of Authorized
of of decrease officer of Trustee or
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ---------------- ---------------- ------------- ---------
A2-11
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Haights Cross Operating Company
c/o Haights Cross Communications, Inc.
00 Xxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank Minnesota, N.A.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Re: 11 3/4% Senior Notes due 2011
Reference is hereby made to the Indenture, dated as of August 20, 2003
(the "Indenture"), among Haights Cross Operating Company, as issuer (the
"Company"), the Guarantors named on the signature pages thereto and Xxxxx Fargo
Bank Minnesota N.A., as trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.
__________________,(the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or, interests (the "Transfer"),
to _____________ (the "Transferee"), as further specified in Annex A hereto. In
connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE 144A GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO
RULE 144A. The Transfer is being effected pursuant to and in accordance with
Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believes is purchasing the beneficial interest or Definitive Note for
its own account, or for one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A, in a
transaction meeting the requirements of Rule 144A and such Transfer is in
compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Restricted
Definitive Note and in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE REGULATION S TEMPORARY GLOBAL NOTE, THE REGULATION S PERMANENT
GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO REGULATION S. The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and, accordingly, the Transferor hereby further
certifies that (i) the Transfer is not being made to a Person in the United
States and (x) at the time the buy order was originated, the Transferee was
outside the United States or such Transferor and any Person acting on its behalf
reasonably believed and believes that the Transferee was outside the United
States or (y) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither such Transferor nor any Person
acting on its behalf knows that the transaction was prearranged with a buyer in
the United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S
under the Securities Act, (iii) the transaction is not part of a plan or scheme
to evade the registration requirements of the Securities Act and (iv) if the
B-1
proposed transfer is being made prior to the expiration of the Restricted
Period, the transfer is not being made to a U.S. Person or for the account or
benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of
the proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on Transfer enumerated in the Private Placement Legend printed on
the Regulation S Permanent Global Note, the Regulation S Temporary Global Note
and/or the Restricted Definitive Note and in the Indenture and the Securities
Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE IAI, GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO ANY
PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and
in accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or
a subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the Securities
Act;
or
(d) [ ] such Transfer is being effected to an
Institutional Accredited Investor and pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A,
Rule 144, Rule 903 or Rule 904, and the Transferor hereby further
certifies that it has not engaged in any general solicitation within
the meaning of Regulation D under the Securities Act and the Transfer
complies with the transfer restrictions applicable to beneficial
interests in a Restricted Global Note or Restricted Definitive Notes
and the requirements of the exemption claimed, which certification is
supported by (1) a certificate executed by the Transferee in the form
of Exhibit D to the Indenture and (2) if such Transfer is in respect of
a principal amount of Notes at the time of transfer of less than
$250,000, an Opinion of Counsel provided by the Transferor or the
Transferee (a copy of which the Transferor has attached to this
certification), to the effect that such Transfer is in compliance with
the Securities Act. Upon consummation of the proposed transfer in
accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the IAI
Global Note and/or the Restricted Definitive Notes and in the Indenture
and the Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the
B-2
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
_____________________________________
[Insert Name of Transferor]
By: _________________________________
Name:
Title:
Dated: ____________
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following :
[CHECK ONE OF (a) OR (b)]
(a) [ ] beneficial interest in the :
(i) [ ] 144A Global Note (CUSIP__________), or
(ii) [ ] Regulation S Global Note (CUSIP__________), or
(iii) [ ] IAI Global Note (CUSIP__________); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP __________), or
(ii) [ ] Regulation S Global Note (CUSIP __________), or
(iii) [ ] IAI Global Note (CUSIP __________); or
(iv) [ ] Unrestricted Global Note (CUSIP __________); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Haights Cross Operating Company
c/o Haights Cross Communications, Inc.
00 Xxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank Minnesota, N.A.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Re : 11 3/4% Senior Notes due 2011
(CUSIP _____________)
Reference is hereby made to the Indenture, dated as of August 20, 2003
(the "Indenture"), among Haights Cross Operating Company, as issuer (the
"Company"), the Guarantors named on the signature pages thereto and Xxxxx Fargo
Bank N.A., as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
________________________________, (the "Owner") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $_____________ in such Note[s] or interests (the
"Exchange"). In connection with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR
BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE . In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with the Securities Act of 1933,
as amended (the "Securities Act"), (iii) the restrictions on transfer contained
in the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest in
an Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
C-1
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL XXXX.Xx connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR
BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] [ ] 144A Global Note, [ ] Regulation S Global Note, [ ] IAI Global
Note with an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer and (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Notes and pursuant to
and in accordance with the Securities Act, and in compliance with any applicable
blue sky securities laws of any state of the United States. Upon consummation of
the proposed Exchange in accordance with the terms of the Indenture, the
beneficial interest issued will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the relevant Restricted
Global Note and in the Indenture and the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
____________________________________________
[Insert Name of Transferor]
C-2
By:__________________________________
Name:
Title:
Dated:________________________
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Haights Cross Operating Company
c/o Haights Cross Communications, Inc.
00 Xxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank Minnesota, N.A.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Re: 11 3/4% Senior Notes due 2011
Reference is hereby made to the Indenture, dated as of August 20, 2003
(the "Indenture"), among Haights Cross Operating Company, as issuer (the
"Company"), the guarantors named on the signature pages thereto and Xxxxx Fargo
Bank Minnesota N.A., as trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the Securities Act of
1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and, if such
transfer is in respect of a principal amount of Notes, at the time of transfer
of less than $250,000, an Opinion of Counsel in form reasonably acceptable to
the Company to the effect that such transfer is in compliance with the
Securities Act, (D) outside the United States in accordance with Rule 904 of
Regulation S under the Securities Act, (E) pursuant to the provisions of Rule
144(k) under the Securities Act or (F) pursuant to an effective registration
statement under the Securities Act, and we further agree to provide to any
Person purchasing the Definitive Note or beneficial interest in a Global Note
from us in a transaction meeting the requirements of clauses (A) through (E) of
this paragraph a notice advising such purchaser that resales thereof are
restricted as stated herein.
D-1
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Notes, and
we and any accounts for which we are acting are each able to bear the economic
risk of our or its investment.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
__________________________________________________
[Insert Name of Accredited Investor]
By:________________________________________________
Name:
Title:
Dated: __________________
D-2
EXHIBIT E
FORM OF NOTE GUARANTEE
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of August 20, 2003 (the "Indenture") among
Haights Cross Operating Company (the "Company"), the Guarantors signatory
thereto and Xxxxx Fargo Bank Minnesota, N.A., as trustee (the "Trustee"), (a)
the due and punctual payment of the principal of, premium and Liquidated
Damages, if any, and interest on the Notes, whether at maturity, by
acceleration, redemption or otherwise, the due and punctual payment of interest
on overdue principal of and interest on the Notes, if any, if lawful, and the
due and punctual performance of all other obligations of the Company to the
Holders or the Trustee all in accordance with the terms of the Indenture and (b)
in case of any extension of time of payment or renewal of any Notes or any of
such other obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise. The obligations of the Guarantors
to the Holders of Notes and to the Trustee pursuant to the Note Guarantee and
the Indenture are expressly set forth in Article 10 of the Indenture and
reference is hereby made to the Indenture for the precise terms of the Note
Guarantee. Each Holder of a Note, by accepting the same, (a) agrees to and shall
be bound by such provisions, (b) authorizes and directs the Trustee, on behalf
of such Holder, to take such action as may be necessary or appropriate to
effectuate the subordination as provided in the Indenture and (c) appoints the
Trustee attorney-in-fact of such Holder for such purpose.
Capitalized terms used but not defined herein have the meanings given
to them in the Indenture.
[GUARANTOR]
By: _________________________
Name:
Title:
E-1
EXHIBIT F
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of,
_________________, 200_, among_____________________ (the "Guaranteeing
Subsidiary"), a subsidiary of Haights Cross Operating Company (or its permitted
successor), a Delaware corporation (the "Company"), the Company, the other
Guarantors (as defined in the Indenture referred to herein) and Xxxxx Fargo Bank
Minnesota, N.A., as trustee under the indenture referred to below (the
"Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of August 20, 2003 providing
for the issuance of 11 3/4% Senior Notes due 2011 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "Note Guarantee"); 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
Guaranteeing Subsidiary 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 GUARANTEE. The Guaranteeing Subsidiary hereby
agrees to provide an unconditional Guarantee on the terms and subject to the
conditions set forth in the Note Guarantee and in the Indenture, including but
limited to Article 10 thereof.
3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees
that the Note Guarantees shall remain in full force and effect notwithstanding
any failure to endorse on each Note a notation of such Note Guarantee.
4. NO RECOURSE AGAINST OTHERS. No past, present or future
director, officer, employee, incorporator, stockholder or agent of the
Guaranteeing Subsidiary, as such, shall have any liability for any obligations
of the Company or any Guaranteeing Subsidiary under the Notes, any Note
Guarantees, 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 of the Notes by accepting a Note waives and releases all such liability.
The waiver and release are part of the consideration for issuance of the Notes.
Such waiver may not be effective to waive liabilities under the federal
securities laws and it is the view of the SEC that such a waiver is against
public policy.
5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW
YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT
WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO
F-1
THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.
6. 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.
7. EFFECT OF HEADINGS. The Section headings herein are for
convenience only and shall not affect the construction hereof.
8. 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 recitals contained herein,
all of which recitals are made solely by the Guaranteeing Subsidiary and the
Company.
F-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: _________________,20___
[GUARANTEEING SUBSIDIARY]
By: ____________________________
Name:
Title:
HAIGHTS CROSS OPERATING COMPANY
By: ____________________________
Name:
Title:
[EXISTING GUARANTORS]
By: ____________________________
Name:
Title:
XXXXX FARGO BANK MINNESOTA, N.A.
as Trustee
By: ____________________________
Authorized Signatory
F-3
