RITE AID CORPORATION
as Issuer
TO
STATE STREET BANK AND TRUST COMPANY
as Trustee
--------------------
Indenture
Dated as of June 27, 2001
--------------------
$152,025,000 12.50% Senior Secured Notes due 2006
TABLE OF CONTENTS
Page
----
ARTICLE I Definitions and Other Provisions of General Application..................................................................1
SECTION 1.01. Definitions.......................................................................................................1
SECTION 1.02. Compliance Certification and Opinions............................................................................21
SECTION 1.03. Form of Documents Delivered To Trustee...........................................................................21
SECTION 1.04. Acts of Holders; Record Date.....................................................................................22
SECTION 1.05. Notices, Etc., To Trustee and the Company........................................................................23
SECTION 1.06. Notice To Holders; Waiver........................................................................................23
SECTION 1.07. Conflict with Trust Indenture Act................................................................................23
SECTION 1.08. Effect of Headings and Table of Contents.........................................................................24
SECTION 1.09. Successors and Assigns...........................................................................................24
SECTION 1.10. Separability Clause..............................................................................................24
SECTION 1.11. Benefits of Indenture............................................................................................24
SECTION 1.12. Governmental Law.................................................................................................24
SECTION 1.13. Legal Holidays...................................................................................................24
ARTICLE II Security Forms.........................................................................................................24
SECTION 2.01. Forms Generally; Initial Forms of Exempt Securities..............................................................24
SECTION 2.02. Form of Face of Security.........................................................................................25
ARTICLE III The Securities........................................................................................................33
SECTION 3.01. Title and Terms..................................................................................................33
SECTION 3.02. Denominations....................................................................................................33
SECTION 3.03. Execution, Authentication, Delivery and Dating...................................................................33
SECTION 3.04. Temporary Securities.............................................................................................34
SECTION 3.05. Global Securities................................................................................................35
SECTION 3.06. Registration, Registration of Transfer and Exchange; Restricted Securities Legends...............................36
SECTION 3.07. Xxxxxxxxx, Xxxxxxxxx, Lost and Stolen Securities.................................................................38
SECTION 3.08. Payment of Interest; Interest Rights Preserved...................................................................39
SECTION 3.09. Persons Deemed Owners............................................................................................40
SECTION 3.10. Cancellation.....................................................................................................40
SECTION 3.11. Computation of Interest..........................................................................................40
SECTION 3.12. Cusip Numbers....................................................................................................41
ARTICLE IV Satisfaction and Discharge.............................................................................................41
SECTION 4.01. Satisfaction and Discharge of Indenture..........................................................................41
SECTION 4.02. Application of Trust Money.......................................................................................42
ARTICLE V Remedies................................................................................................................42
SECTION 5.01. Events of Default................................................................................................42
SECTION 5.02. Acceleration of Maturity; Rescission and Annulment...............................................................45
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by Trustee..................................................46
SECTION 5.04. Trustee May File Proofs of Claim.................................................................................46
SECTION 5.05. Trustee May Enforce Claims Without Possession of Securities......................................................47
SECTION 5.06. Application of Money Collected...................................................................................47
SECTION 5.07. Limitation on Suits..............................................................................................47
i
SECTION 5.08. Unconditional Right of Holders To Receive Principal, Premium and Interest........................................48
SECTION 5.09. Restoration of Rights and Remedies...............................................................................48
SECTION 5.10. Rights and Remedies Cumulative...................................................................................48
SECTION 5.11. Delay or Omission Not Waiver.....................................................................................48
SECTION 5.12. Control by Holders...............................................................................................49
SECTION 5.13. Waiver of Past Defaults..........................................................................................49
SECTION 5.14. Undertaking for Costs............................................................................................49
SECTION 5.15. Waiver of Stay or Extension Laws.................................................................................49
SECTION 5.16. Enforcement of Remedies..........................................................................................50
ARTICLE VI The Trustee............................................................................................................50
SECTION 6.01. Certain Duties and Responsibilities..............................................................................50
SECTION 6.02. Notice of Defaults...............................................................................................50
SECTION 6.03. Certain Rights of Trustee........................................................................................50
SECTION 6.04. Not Responsible for Recitals or Issuance of Securities...........................................................52
SECTION 6.05. May Hold Securities..............................................................................................52
SECTION 6.06. Money Held in Trust..............................................................................................52
SECTION 6.07. Compensation and Reimbursement...................................................................................52
SECTION 6.08. Disqualification; Conflicting Interest...........................................................................53
SECTION 6.09. Corporate Trustee Required; Eligibility..........................................................................53
SECTION 6.10. Resignation and Removal; Appointment of Successor................................................................53
SECTION 6.11. Acceptance of Appointment by Successor...........................................................................55
SECTION 6.12. Merger, Conversion, Consolidation or Succession to Business......................................................55
SECTION 6.13. Preferential Collection of Claims Against Company................................................................55
ARTICLE VII Holders' Lists and Reports by Trustee and Company.....................................................................55
SECTION 7.01. Company To Furnish Trustee Names and Addresses of Holders........................................................56
SECTION 7.02. Preservation of Information; Communications to Holders...........................................................56
SECTION 7.03. Reports by Trustee...............................................................................................56
SECTION 7.04. Reports by Company...............................................................................................57
ARTICLE VIII Consolidation, Xxxxxx, Xxxxxxxxxx, Transfer or Lease.................................................................57
SECTION 8.01. Company and the Subsidiary Guarantors May Consolidate, Etc., Only on Certain Terms...............................57
SECTION 8.02. Successor Substituted............................................................................................59
ARTICLE IX Supplemental Indentures................................................................................................60
SECTION 9.01. Supplemental Indentures Without Consent of Holders...............................................................60
SECTION 9.02. Supplemental Indentures with Consent of Holders..................................................................60
SECTION 9.03. Execution of Supplemental Indentures.............................................................................62
SECTION 9.04. Effect of Supplemental Indentures................................................................................62
SECTION 9.05. Conformity with Trust Indenture Act..............................................................................62
SECTION 9.06. Reference in Securities to Supplemental Indentures...............................................................62
ARTICLE X Covenants...............................................................................................................62
SECTION 10.01. Payment of Principal, Premium and Interest.......................................................................62
SECTION 10.02. Maintenance of Office or Agency..................................................................................62
SECTION 10.03. Money for Security Payments To Be Held in Trust..................................................................63
SECTION 10.04. Corporate Existence..............................................................................................64
SECTION 10.05. Maintenance of Properties........................................................................................64
SECTION 10.06. Payment of Taxes and Other Claims................................................................................64
SECTION 10.07. Insurance........................................................................................................65
SECTION 10.08. Restrictions on Funded Debt of Restricted Subsidiaries...........................................................65
SECTION 10.09. Restriction on Sales with Leases Back............................................................................65
SECTION 10.10. Restrictions on Secured Debt.....................................................................................66
SECTION 10.11. Restrictions on Impairment of Security Interest..................................................................67
SECTION 10.12. Restrictions on Amendments to Collateral Documents...............................................................67
SECTION 10.13. Future Subsidiary Guarantors.....................................................................................68
SECTION 10.14. Application of Collateral Proceeds...............................................................................68
SECTION 10.15. Restrictions on Permitting Unrestricted Subsidiaries To Become Restricted Subsidiaries...........................70
SECTION 10.16. Statement by Officers as to Default..............................................................................70
SECTION 10.17. Waiver of Certain Covenants......................................................................................71
ARTICLE XI Redemption of Securities...............................................................................................71
SECTION 11.01. Right of Redemption..............................................................................................71
SECTION 11.02. Election To Redeem; Notice To Trustee............................................................................71
SECTION 11.03. Selection by Trustee of Securities To Be Redeemed................................................................71
SECTION 11.04. Notice of Redemption.............................................................................................72
SECTION 11.05. Deposit of Redemption Price......................................................................................72
SECTION 11.06. Securities Payable on Redemption Date............................................................................72
SECTION 11.07. Securities Redeemed in Part......................................................................................73
ARTICLE XII Defeasance and Covenant Defeasance....................................................................................73
SECTION 12.01. Company's Option To Effect Defeasance or Covenant Defeasance.....................................................73
SECTION 12.02. Defeasance and Discharge.........................................................................................73
SECTION 12.03. Covenant Defeasance..............................................................................................74
SECTION 12.04. Conditions to Defeasance or Covenant Defeasance..................................................................74
SECTION 12.05. Deposited Money and U.S. Government Obligations To Be Held in Trust; Other Miscellaneous Provisions..............75
SECTION 12.06. Reinstatement....................................................................................................76
Reconciliation and tie between Trust Indenture Act
of 1939 and Indenture dated as of June 27, 2001
Trust Indenture Indenture
Act Section Section
-------------------------- -------------------------
310
(a)(1) ......................................................... 6.09
(a)(2) ......................................................... 6.09
(a)(3) ......................................................... Not Applicable
(a)(4) ......................................................... Not Applicable
(b) ......................................................... 6.08
......................................................... 6.10
311
(a) ......................................................... 6.13
(b) ......................................................... 6.13
(b) (2) ......................................................... 7.03
312
(a) ......................................................... 7.01
......................................................... 7.02 (a)
(b) ......................................................... 7.02 (b)
(c) ......................................................... 7.02 (c)
313
(a) ......................................................... 7.03 (a)
(b) ......................................................... 7.03 (a)
(c) ......................................................... 7.03 (a)
(d) ......................................................... 7.03 (b)
314
(a) ......................................................... 7.04
(b) ......................................................... Not Applicable
(c) (1) ......................................................... 1.02
(c) (2) ......................................................... 1.02
(c) (3) ......................................................... Not Applicable
(d) ......................................................... Not Applicable
(e) ......................................................... 1.02
315
(a) ......................................................... 6.01
(b) ......................................................... 6.02
......................................................... 7.03 (a)
(c) ......................................................... 6.01
(d) ......................................................... 6.01
(d) (1) ......................................................... 6.03
(d) (2) ......................................................... 6.03
(d) (3) ......................................................... 6.03
(e) ......................................................... 5.14
Trust Indenture Indenture
Act Section Section
-------------------------- -------------------------
316
(a) (1) (A) ......................................................... 5.12
(a) (1) (B) ......................................................... 5.13
(a) (2) ......................................................... Not Applicable
(b) ......................................................... 5.08
317
(a) (1) ......................................................... 5.03
(a) (2) ......................................................... 5.04
(b) ......................................................... 10.03
318
(a) ......................................................... 1.07
-----------------------
Note: This is reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Indenture.
INDENTURE, dated as of June 27, 2001, among Rite Aid
Corporation, a corporation duly organized and existing under the laws of the
State of Delaware (herein called the "Company"), having its principal office at
00 Xxxxxx Xxxx, Xxxx Xxxx, Xxxxxxxxxxxx, 00000, each of the Subsidiary
Guarantors named herein and State Street Bank and Trust Company, a Massachusetts
trust company, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of $152,025,000
aggregate principal amount of its 12.50% Senior Secured Notes due 2006 (the
"Securities") in substantially the tenor and amount hereinafter set forth, and
to provide therefore, the Company has duly authorized the execution and delivery
of this Indenture.
All things necessary (i) to make the Securities, when executed
by the Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company and (ii) to make this Indenture a
valid agreement of the Company and the Subsidiary Guarantors, all in accordance
with their respective terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities, as
follows:
ARTICLE I
Definitions and Other Provisions of General Application
SECTION 1.01. Definitions. For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as
the singular;
(b) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles (whether or not such is indicated herein),
and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any
computation required or permitted hereunder shall mean such
accounting principles as are generally accepted as consistently
applied by the Company at the date of such computation; and
(d) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not
to any particular Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning
specified in Section 1.04.
"Additional Second Priority Debt" means any indebtedness
incurred by Rite Aid and guaranteed by the Subsidiary Guarantors after the
Closing Date pursuant to the Second Priority Subsidiary Guarantee Agreement
which is secured by the Second Priority Collateral on a pari passu basis with
the other Second Priority Debt Obligations; provided, however, that (i) such
indebtedness is permitted to be incurred, secured and guaranteed on such basis
by each Senior Debt Document and each Second Priority Debt Document, (ii) the
aggregate amount of such Additional Second Priority Debt does not exceed
$300,000,000 at any time outstanding (it being understood that any amounts
incurred in excess of such amount will not at any time qualify as Additional
Second Priority Debt) and (iii) the Representative for the holders of such
Additional Second Priority Debt shall have become party to the Intercreditor
Agreement pursuant to, and by satisfying the conditions set forth in, Section
10.12 thereof. Additional Second Priority Debt shall include any Registered
Equivalent Notes issued in exchange for Additional Second Priority Debt
initially sold in a Rule 144A or other private placement transaction.
"Additional Second Priority Debt Documents" means, with
respect to any series, issue or class of Additional Second Priority Debt, the
promissory notes, indentures or other operative agreements evidencing or
governing such indebtedness, as furnished pursuant to Section 10.12 of the
Intercreditor Agreement.
"Additional Second Priority Debt Facility" means the indenture
or other governing agreement with respect to any Additional Second Priority
Debt.
"Additional Second Priority Debt Obligations" means, with
respect to any series, issue or class of Additional Second Priority Debt, (i)
all principal of and interest (including without limitation, any interest which
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency or reorganization of the Company, whether or not
allowed or allowable as a claim in any such proceeding) on such Additional
Second Priority Debt, (ii) all other amounts payable by the Borrower to the
related Additional Second Priority Debt Parties under the related Additional
Second Priority Debt Documents and (iii) any renewals or extensions of the
foregoing.
"Additional Second Priority Debt Parties" means, with respect
to any series, issue or class of Additional Second Priority Debt, the holders of
such indebtedness, any trustee or agent therefor under any related Additional
Second Priority Debt Documents and the beneficiaries of each indemnification
2
obligation undertaken by Rite Aid or any Obligor under any related Additional
Second Priority Debt Documents, but shall not include the Obligors or any
controlled Affiliates thereof.
"Additional Senior Second Priority Debt" means any
indebtedness incurred by Rite Aid and guaranteed by the Subsidiary Guarantors
pursuant to the Second Priority Subsidiary Guarantee Agreement after the Closing
Date which is secured by the Second Priority Collateral on a pari passu basis
with the Synthetic Lease Obligations; provided, however, that (i) such
indebtedness is permitted to be incurred, secured and guaranteed on such basis
by each Senior Debt Document and each Second Priority Debt Document, (ii) the
aggregate amount of such Additional Senior Second Priority Debt does not exceed
$93,000,000 at any time outstanding (it being understood that any amounts
incurred in excess of such amount will not at any time qualify as Additional
Senior Second Priority Debt) and (iii) the Representative for the holders of
such Additional Senior Second Priority Debt shall have become party to the
Intercreditor Agreement pursuant to, and by satisfying the conditions set forth
in, Section 10.12 thereof. Additional Senior Second Priority Debt shall include
any Registered Equivalent Notes issued in exchange for Additional Senior Second
Priority Debt initially sold in a Rule 144A or other private placement
transaction.
"Additional Senior Second Priority Debt Documents" means, with
respect to any series, issue or class of Additional Senior Second Priority Debt,
the promissory notes, indentures or other operative agreements evidencing or
governing such indebtedness, as furnished pursuant to Section 10.12 of the
Intercreditor Agreement.
"Additional Senior Second Priority Debt Facility" means the
indenture or other governing agreement with respect to any Additional Senior
Second Priority Debt.
"Additional Senior Second Priority Debt Obligations" means,
with respect to any series, issue or class of Additional Senior Second Priority
Debt, (i) all principal of and interest (including without limitation, any
interest which accrues after the commencement of any case, proceeding or other
action relating to the bankruptcy, insolvency or reorganization of the Company,
whether or not allowed or allowable as a claim in any such proceeding) on such
Additional Senior Second Priority Debt, (ii) all other amounts payable by the
Company to the related Additional Senior Second Priority Debt Parties under the
related Additional Senior Second Priority Debt Documents and (iii) any renewals
or extensions of the foregoing.
"Additional Senior Second Priority Debt Parties" means, with
respect to any series, issue or class of Additional Senior Second Priority Debt,
the holders of such indebtedness, any trustee or agent therefore under any
related Additional Senior Second Priority Debt Documents and the beneficiaries
of each indemnification obligation undertaken by Rite Aid or any Obligor under
any related Additional Senior Second Priority Debt Documents, but shall not
include the Obligors or any controlled Affiliates thereof.
"Affiliate" of any Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such Person. For the purposes of this definition, "control" when
3
used with respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agent Member" means any member of, or participant in, the
Depositary.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Security to the extent
applicable to such transaction and as in effect at the time of such transfer or
transaction.
"Attributable Debt" means, as to any particular Sale and
Leaseback Transaction under which the Company or any Restricted Subsidiary is at
the time liable, at any date as of which the amount thereof is to be determined
(i) in the case of any such transaction involving a Capital Lease, the amount on
such date of the Capital Lease Obligation thereunder, or (ii) in the case of any
other such Sale and Leaseback Transaction, the then present value of the minimum
rental obligation under such transaction during the remaining term thereof
(after giving effect to any extensions at the option of the lessor) computed by
discounting the respective rental payments at the actual interest factor
included in such payment, or, if such interest factor included in such payment,
or, if such interest factor cannot be readily determined, at the rate per annum
equal to the rate of interest on the Securities. The amount of any rental
payment required to be made under any such Sale and Leaseback Transaction not
involving a Capital Lease may exclude amounts required to be paid by the lessee
on account of maintenance and repairs, insurance, taxes, assessments, utilities,
operating and labor costs and similar charges.
"Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.
"Bankruptcy Proceeding" means any proceeding under Title 11 of
the U.S. Code or any other Federal, state or foreign bankruptcy, insolvency,
reorganization, receivership or similar law.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" means any day other than a Saturday, a Sunday
or a day on which banking institutions in The City of New York, New York,
Hartford, Connecticut or Boston, Massachusetts are authorized or obligated by
law, regulation, executive order or governmental decree to close.
"Capital Lease" means any lease of property which, in
accordance with generally accepted accounting principles, should be capitalized
on the lessee's balance sheet; and "Capital Lease Obligation" means the amount
of the liability so capitalized or disclosed (or which should be so disclosed)
in a note in respect of a Capital Lease.
4
"Capital Stock" means, with respect to any Person, any shares
or other equivalents (however designated) of any class of corporate stock or
partnership interests or any other participations, rights, warrants, options or
other interests in the nature of an equity interest in such Person, including
preferred stock, but excluding any debt security convertible or exchangeable
into such equity interest.
"Casualty/Condemnation" means any action or proceeding for the
taking of any assets of the Company or its Subsidiaries, or any part thereof or
interest therein, for public or quasi-public use under the power of eminent
domain, by reason of any similar public improvement or condemnation proceeding.
"Closing Date" means June 27, 2001.
"Collateral" means the Senior Collateral and the Second
Priority Collateral.
"Collateral Documents" means (a) the Senior Collateral
Documents and (b) the Second Priority Collateral Documents.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or, if at any
time after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture and thereafter "Company"
shall mean such successor Person.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary and delivered to the Trustee.
"Consolidated Funded Debt" means the total of all outstanding
Funded Debt of the Company and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with generally accepted accounting principles.
"Consolidated Net Tangible Assets" means (a) the total amount
of assets (less applicable reserves and other properly deductible items) which
under generally accepted accounting principles would be included on a
consolidated balance sheet of the Company and its Restricted Subsidiaries after
deducting therefrom (i) all liabilities and liability items, including amounts
in respect of obligations or guarantees of obligations under leases, which under
generally accepted accounting principles would be included on such balance
sheet, except Funded Debt, capital stock and surplus, surplus reserves and
provisions for deferred income taxes, and (ii) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense and other like
intangibles, which in each case under generally accepted accounting principles
5
would be included on such consolidated balance sheet, less (b) the amount which
would be so included on such consolidated balance sheet for Investments (less
applicable reserves) (i) made in Unrestricted Subsidiaries or (ii) made in
corporations while they were Unrestricted Subsidiaries but which at the time of
computation are not Subsidiaries of the Company.
"Corporate Trust Office" means the principal corporate trust
office of the Trustee in the City of Boston, State of Massachusetts, at which at
any particular time its corporate trust business shall be administered.
"corporation" means a corporation, association, company,
limited liability company, joint-stock company, partnership or business trust.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section
3.08.
"Depositary" means, with respect to any Securities, a clearing
agency that is registered as such under the Exchange Act and is designated by
the Company to act as Depositary for such Securities (or any successor
securities clearing agency so registered).
"DTC" means The Depository Trust Company, a New York
corporation.
"Event of Default" has the meaning specified in Section 5.01.
"Exchange Act" refers to the Securities Exchange Act of 1934
as it may be amended and any successor act thereto.
"Exchange and Registration Rights Agreement" means the
Exchange and Registration Rights Agreement, dated as of June 27, 2001, among the
Company, each of the Subsidiary Guarantors and the Holders from time to time as
provided therein, as such agreement may be amended from time to time.
"Exchange Note Documents" means the Securities, this Indenture
and the Exchange and Registration Rights Agreement.
"Exchange Note Obligations" means (i) all principal of and
interest (including, without limitation, any interest which accrues after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Company, whether or not allowed or allowable
as a claim in any such proceeding) on the Securities, (ii) all other amounts
payable by the Company to the Exchange Note Parties under the Exchange Note
Documents, and (iii) any renewals and extensions of the foregoing.
"Exchange Note Parties" means the Holders, the Trustee and the
beneficiaries of each indemnification obligation undertaken by the Company or
any other Obligor under any Exchange Note Document but shall not include the
Obligors or any controlled Affiliate thereof.
6
"Exchange Offer" means an offer made by the Company pursuant
to the Exchange and Registration Rights Agreement under an effective
registration statement under the Securities Act to exchange securities
substantially identical to Outstanding Securities (except for the differences
provided for herein) for Outstanding Securities.
"Exchange Registration Statement" means a registration
statement of the Company under the Securities Act registering Exchange
Securities for distribution pursuant to the Exchange Offer.
"Exchange Securities" means the Securities issued pursuant to
the Exchange Offer and their Successor Securities.
"Exempt Securities" means the Securities acquired by Holders
from the Company pursuant to the Note Exchange Agreement.
"Funded Debt" means any indebtedness for money borrowed,
created, issued, incurred, assumed or guaranteed, whether secured or unsecured,
maturing more than one year after the date of determination thereof and any
indebtedness, regardless of its term, renewable pursuant to the terms thereof or
of a revolving credit or similar agreement effective for more than one year
after the date of the creation of the indebtedness, which would, in accordance
with generally accepted accounting practice, be classified as funded debt but
shall not include:
(a) any indebtedness for the payment, redemption or
satisfaction of which money (or evidences of indebtedness, if
permitted under the instrument creating such indebtedness) in the
necessary amount shall have been deposited in trust with the Trustee
or proper depository either at or before maturity or redemption date
thereof; or
(b) guarantees arising in connection with the sale, discount,
guarantee or pledge of Securities, chattel mortgages, leases,
accounts receivable, trade acceptances and other paper arising, in
the ordinary course of business, out of installment or conditional
sales to or by, or transactions involving title retention with,
distributors, dealers or other customers of merchandise, equipment
or services or guarantees other than guarantees of indebtedness for
borrowed money; or
(c) any liability resulting from the capitalization of lease
rentals.
"Global Security" means a Security that is registered in the
Security Register in the name of a Depositary or a nominee thereof.
"Holder" means a Person in whose name a Security is registered
in the Security Register.
7
"indebtedness" means (i) all items of indebtedness or
liability (except capital and surplus) which in accordance with generally
accepted accounting principles would be included in determining total
liabilities as shown on the liability side of a balance sheet as at the date as
of which indebtedness is to be determined, (ii) indebtedness secured by any
Mortgage existing on property owned subject to such Mortgage, whether or not the
indebtedness secured thereby shall have been assumed, and (iii) guarantees,
endorsements (other than for purposes of collection) and other contingent
obligations in respect of, or to purchase or otherwise acquire, indebtedness of
others, unless the amount thereof is included in indebtedness under the
preceding clauses (i) or (ii); provided, however, that any obligations or
guarantees of such obligations or guarantees of obligations in respect of lease
rentals, whether or not such obligations or guarantees of obligations would be
included as liabilities on a consolidated balance sheet of the Company and its
Restricted Subsidiaries, shall not be included in indebtedness.
"Indenture" means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.
"Intercreditor Agreement" means the Collateral Trust and
Intercreditor Agreement, dated as of June 27, 2001, among the Company, the
Subsidiary Guarantors, the Second Priority Collateral Trustee, the Senior
Collateral Agent, State Street Bank and Trust Company, as trustee under the
Company's 10.5% Senior Secured Notes due 2002, Xxxxx Fargo Bank Northwest,
National Association, as collateral agent for the Synthetic Lease Parties under
the Synthetic Lease Documents, the Trustee and each Second Priority
Representative.
"Interest Payment Date" means the Stated Maturity of an
installment of interest on the Securities.
"Investments" mean and include all investments, whether by
acquisition of stock or indebtedness, or by loan, advance, transfer of property,
capital contribution or otherwise, made by the Company or by any Restricted
Subsidiary, and shall include all guarantees, direct or indirect, by the Company
or any Restricted Subsidiary of any indebtedness of an Unrestricted Subsidiary
which by its term matures 12 months or less from the time of computation of the
amount thereof to the extent not included as a liability or liability item on
the consolidated balance sheet of the Company and its Restricted Subsidiaries,
but shall not include accounts receivable of the Company or of any Restricted
Subsidiary arising from the sale of merchandise in the ordinary course of
business.
"Maturity", when used with respect to any Security, means the
date on which the principal of such Security becomes due and payable as therein
or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
8
"Mortgage" means and includes any mortgage, pledge, lien,
security interest, conditional sale or other title retention agreement or other
similar encumbrance.
"Note Exchange Agreement" means the agreement between the
Company and the entities party thereto, dated as of June 27, 2001 pursuant to
which the Company has issued the Original Securities in exchange for
$152,025,000 aggregate principal amount of the 10.50% Notes.
"Notice of Default" shall have the meaning specified in
Section 5.01(4).
"Obligors" means the Company, the Subsidiary Guarantors and
any other Person who is liable for any of the Secured Obligations.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the President or a Vice President, and by the Treasurer,
an Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company
and delivered to the Trustee.
"Opinion of Counsel" means a written opinion in form and
substance reasonably satisfactory to the Trustee, of counsel, who may be counsel
for the Company, and who shall be acceptable to the Trustee.
"Original Securities" means all Securities other than Exchange
Securities.
"Outstanding", when used with respect to Securities, means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its
own Paying Agent) for the Holders of such Securities; provided that,
if such Securities are to be redeemed, notice of such redemption has
been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made;
(iii) Securities which have been transferred pursuant to
Section 3.06 or in exchange for or in lieu of which other Securities
have been authenticated and delivered pursuant to this Indenture,
other than any such Securities in respect of which there shall have
been presented to the Trustee proof satisfactory to it that such
Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company; and
(iv) Securities paid pursuant to Section 3.07;
9
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which a Responsible Officer of the Trustee
actually knows to be so owned shall be so disregarded. Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not the Company or any
other obligor upon the Securities or any Affiliate of the Company or of such
other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Securities on
behalf of the Company.
"Person" means any individual, corporation, partnership, joint
venture, association, limited liability company, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.07 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Refinance" means, in respect of any indebtedness, to
refinance, extend, renew, refund, repay, prepay, repurchase, redeem, defease or
retire, or to issue other indebtedness, in exchange or replacement for, such
indebtedness. "Refinanced" and "Refinancing" shall have correlative meanings.
"Registered Equivalent Notes" means, with respect to any notes
originally issued in a Rule 144A or other private placement transaction under
the Securities Act of 1933, substantially identical notes issued in a dollar for
dollar exchange therefor pursuant to an exchange offer registered with the SEC.
"Registration Default" means the occurrence of any of the
following events: (i) the Company has not filed the Exchange Registration
Statement or Shelf Registration Statement on or before the date on which such
registration statement is required to be filed pursuant to the Exchange and
Registration Rights Agreement, (ii) the Exchange Registration Statement or Shelf
10
Registration Statement has not become effective or been declared effective by
the Commission on or before the date on which such registration statement is
required to become or be declared effective under the requirements of the
Exchange and Registration Rights Agreement, (iii) the Exchange Offer has not
been completed on or before the date required by the Exchange and Registration
Rights Agreement or (iv) any Exchange Registration Statement or Shelf
Registration Statement required to be filed pursuant to the Exchange and
Registration Rights Agreement is filed and declared effective but shall
thereafter cease to be effective without being again effective within 30 days or
being succeeded within 30 days by an additional Exchange Registration Statement
or Shelf Registration Statement filed and declared effective.
"Registration Default Period" means any period during which a
Registration Default has occurred and is continuing.
"Regular Record Date" means the date that is the fifteenth
calendar day (whether or not a Business Day) immediately preceding the related
Interest Payment Date.
"Replacement Second Priority Debt" means indebtedness incurred
by Rite Aid after the Closing Date in exchange for, or the proceeds of which are
used to repay and refinance, any Exchange Notes, any Additional Second Priority
Debt or any other Replacement Second Priority Debt theretofore issued, and which
is guaranteed by the Subsidiary Guarantors pursuant to the Second Priority
Subsidiary Guarantee Agreement and secured on a pari passu basis with any such
Exchange Notes, Additional Second Priority Debt or previously issued Replacement
Second Priority Debt; provided, however, that (i) the terms of any such
Replacement Second Priority Debt and of the related Replacement Second Priority
Debt Documents are permitted by the Senior Loan Documents, (ii) the maturity of
such Replacement Second Priority Debt is no earlier than the later of the
maturity of the indebtedness being refinanced and January 1, 2006, and the
weighted average life thereof is no less than that of the indebtedness being
refinanced, (iii) the terms relating to amortization and the other material
terms of such Replacement Second Priority Debt are no less favorable in any
material respect of the Company and the Subsidiaries or the Senior Bank Parties
than the terms of any agreement or instrument governing the indebtedness being
refinanced and the interest rate applicable thereto does not exceed then current
market interest rates and (iv) the principal amount of such Replacement Second
Priority Debt does not exceed the principal amount of the indebtedness being
refinanced which is outstanding immediately prior to such refinancing.
Replacement Second Priority Debt shall include any Registered Equivalent Notes
issued in exchange for Replacement Second Priority Debt initially sold in a Rule
144A or other private placement transaction.
"Replacement Second Priority Debt Documents" means, with
respect to any series, issue or class of Replacement Second Priority
indebtedness, the promissory notes, indentures or other operative agreements
evidencing or governing such indebtedness, as furnished pursuant to Section
10.12 of the Intercreditor Agreement.
11
"Replacement Second Priority Debt Facility" means the
indenture or other governing agreement with respect to any Replacement Second
Priority Debt.
"Replacement Second Priority Debt Obligations" means, with
respect to any series, issue or class of Replacement Second Priority Debt, (i)
all principal of and interest (including without limitation, any interest which
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency or reorganization of the Company, whether or not
allowed or allowable as a claim in any such proceeding) on such Replacement
Second Priority Debt, (ii) all other amounts payable by the Company to the
related Replacement Second Priority Debt parties under the related Replacement
Second Priority Debt Documents and (iii) any renewals or extensions of the
foregoing.
"Replacement Second Priority Debt Parties" means, with respect
to any series, issue or class of Replacement Second Priority Debt, the holders
of such indebtedness, any trustee or agent therefor under any related
Replacement Second Priority Debt Documents and the beneficiaries of each
indemnification obligation undertaken by Rite Aid or any Obligor under any
related Replacement Second Priority Debt Documents, but shall not include the
Obligors or any controlled Affiliates thereof.
"Replacement Senior Second Priority Debt" means indebtedness
incurred by Rite Aid after the Closing Date in exchange for, or the proceeds of
which are used to repay and refinance, any Attributable Debt in respect of
Synthetic Lease Obligations, any Additional Senior Second Priority Debt or any
other Replacement Senior Second Priority Debt theretofore issued, and which is
guaranteed by the Subsidiary Guarantors pursuant to the Second Priority
Subsidiary Guarantee Agreement and secured on a pari passu basis with any such
Synthetic Lease Obligations, Additional Senior Second Priority Debt or
previously issued Replacement Senior Second Priority Debt; provided, however,
that (i) the terms of any such Replacement Senior Second Priority Debt and of
the related Replacement Senior Second Priority Debt Documents are permitted by
the Senior Loan Documents, (ii) the maturity of such Replacement Senior Second
Priority Debt is no earlier than the later of the maturity of the indebtedness
being refinanced and January 1, 2006, and the weighted average life thereof is
no less than that of the indebtedness being refinanced, (iii) the terms relating
to amortization and the other material terms of such Replacement Senior Second
Priority Debt are no less favorable in any material respect to the Company and
the Subsidiaries or the Senior Bank Parties than the terms of any agreement or
instrument governing the indebtedness being refinanced and the interest rate
applicable thereto does not exceed then current market interest rates and (iv)
the principal amount (or Attributable Debt amount) of such Replacement Senior
Second Priority Debt does not exceed the principal amount (or Attributable Debt
amount) of the indebtedness or Attributable Debt being refinanced which is
outstanding immediately prior to such refinancing. Replacement Senior Second
Priority Debt shall include any Registered Equivalent Notes issued in exchange
for Replacement Senior Second Priority Debt initially sold in a Rule 144A or
other private placement transaction.
"Replacement Senior Second Priority Debt Documents" means,
with respect to any series, issue or class of Replacement Senior Second Priority
Debt, the promissory notes, indentures or other operative agreements evidencing
12
or governing such indebtedness, as furnished pursuant to Section 10.12 of the
Intecreditor Agreement.
"Replacement Senior Second Priority Debt Facility" means the
indenture or other governing agreement with respect to any Replacement Senior
Second Priority Debt.
"Replacement Senior Second Priority Debt Obligations" means,
with respect to any series, issue or class of Replacement Senior Second Priority
Debt, (i) all principal of and interest (including without limitation, any
interest which accrues after the commencement of any case, proceeding or other
action relating to the bankruptcy, insolvency or reorganization of the Company,
whether or not allowed or allowable as a claim in any such proceeding) on such
Replacement Senior Second Priority Debt, (ii) all other amounts payable by the
Company to the related Replacement Senior Second Priority Debt Parties under the
related Replacement Senior Second Priority Debt Documents and (iii) any renewals
or extensions of the foregoing.
"Replacement Senior Second Priority Debt Parties" means, with
respect to any series, issue or class of Replacement Senior Second Priority
Debt, the holders of such indebtedness, any trustee or agent therefor under any
related Replacement Senior Second Priority Debt Documents and the beneficiaries
of each indemnification obligation undertaken by Rite Aid or any Obligor under
any related Replacement Senior Second Priority Debt Documents, but shall not
include the Obligors or any controlled Affiliates thereof.
"Representatives" means each of the Senior Collateral Agent,
the trustee under the 10.5% Note Indenture and the Second Priority
Representatives.
"Responsible Officer", when used with respect to the Trustee,
means any vice president, any assistant vice president, any assistant secretary,
any assistant treasurer, any trust officer or assistant trust officer, 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 Global Securities" means all Global Securities
required pursuant to Section 3.06(c) to bear a Restricted Securities Legend.
"Restricted Securities" means all Securities required pursuant
to Section 3.06(c) to bear a Restricted Securities Legend. Such term includes
the Restricted Global Securities.
"Restricted Securities Legend" means a legend substantially in
the form of the legend required in the form of Security set forth in Section
2.02 to be placed upon a Restricted Security.
"Restricted Subsidiary" means any Subsidiary, whether existing
on or after the date of this Indenture, unless such Subsidiary is an
Unrestricted Subsidiary.
13
"Sale and Leaseback Transaction" has the meaning specified in
Section 10.09.
"Second Priority Collateral" means all the "Second Priority
Collateral" as defined in any Second Priority Collateral Document and shall also
include the mortgaged properties described in the Senior Credit Facility and the
proceeds thereof.
"Second Priority Collateral Documents" means the Second
Priority Mortgages, the Second Priority Subsidiary Security Agreement, the
Second Priority Subsidiary Guarantee Agreement, the Second Priority Indemnity,
Subrogation and Contribution Agreement, the Intercreditor Agreement and each of
the mortgages, security agreements and other instruments and documents executed
and delivered by any Subsidiary Guarantor pursuant to any of the foregoing for
purposes of providing collateral security or credit support for any Second
Priority Debt Obligation or obligation under the Second Priority Subsidiary
Guarantee Agreement.
"Second Priority Collateral Trustee" means Wilmington Trust
Company, in its capacity as collateral trustee under the Intercreditor Agreement
and the Second Priority Collateral Documents, and its successors.
"Second Priority Debt Documents" means the Exchange Note
Documents, the Synthetic Lease Documents, the Additional Senior Second Priority
Debt Documents, if any, the Additional Second Priority Debt Documents, if any,
the Replacement Senior Second Priority Debt Documents, if any, the Replacement
Second Priority Debt Documents, if any, and the Second Priority Collateral
Documents.
"Second Priority Debt Obligations" means the collective
reference to the Exchange Note Obligations, the Synthetic Lease Obligations, the
Additional Senior Second Priority Debt Obligations, if any, the Additional
Second Priority Debt Obligations, if any, the Replacement Senior Second Priority
Debt Obligations, if any, and the Replacement Second Priority Debt Obligations,
if any.
"Second Priority Debt Parties" means the Exchange Note
Parties, the Synthetic Lease Parties, the Additional Senior Second Priority Debt
Parties, if any, the Additional Second Priority Debt Parties, if any, the
Replacement Senior Second Priority Debt Parties, if any, the Replacements Second
Priority Debt Parties, if any, and the Second Priority Collateral Trustee.
"Second Priority Facilities" means this Indenture, the
Synthetic Lease Facilities, any Additional Senior Second Priority Debt
Facilities, any Additional Second Priority Debt Facilities, any Replacement
Senior Second Priority Debt Facilities and any Replacement Second Priority Debt
Facilities.
"Second Priority Indemnity, Subrogation and Contribution
Agreement" means the Second Priority Indemnity, Subrogation and Contribution
Agreement, dated as of June 27, 2001, among the Company, the Subsidiary
Guarantors and the Second Priority Collateral Trustee.
14
"Second Priority Lien" means the liens on the Second Priority
Collateral in favor of the Second Priority Debt Parties under the Second
Priority Collateral Documents.
"Second Priority Mortgages" means the mortgages, deeds of
trust, leasehold mortgages, assignments of leases and rents, modifications and
other security documents which create a lien in favor of the Second Priority
Collateral Trustee for the benefit of the Second Priority Debt Parties,
delivered pursuant to the Second Priority Debt Documents.
"Second Priority Representative" means, in respect of a Second
Priority Facility, the Trustee, the collateral agent under the Synthetic Lease
Facility and the administrative agent or agent under each other Second Priority
Facility, as the case may be, and each of their successors in such capacities.
"Second Priority Subsidiary Guarantee Agreement" means the
Second Priority Subsidiary Guarantee Agreement, dated as of June 27, 2001, made
by the Subsidiary Guarantors (including any additional Subsidiary Guarantor
becoming party thereto after the Closing Date) in favor of the Second Priority
Collateral Trustee for the benefit of the Second Priority Debt Parties.
"Second Priority Subsidiary Security Agreement" means the
Second Priority Subsidiary Security Agreement, dated as of June 27, 2001, made
by the Subsidiary Guarantors (including any additional Subsidiary Guarantor
becoming party thereto after the Closing Date) in favor of the Second Priority
Collateral Trustee for the benefit of the Second Priority Debt Parties.
"Secured Debt" means indebtedness for money borrowed which is
secured by a mortgage, pledge, lien, security interest or encumbrance on
property of the Company or any Restricted Subsidiary, but shall not include
guarantees arising in connection with the sale, discount, guarantee or pledge of
notes, chattel mortgages, leases, accounts receivable, trade acceptances and
other paper arising, in the ordinary course of business, out of installment or
conditional sales to or by, or transactions involving title retention with,
distributors, dealers or other customers, of merchandise, equipment or services.
"Secured Obligations" means the Senior Obligations and the
Second Priority Debt Obligations.
"Securities" means Securities designated in the first
paragraph of the RECITALS OF THE COMPANY and includes the Original Securities
and the Exchange Securities.
"Securities Act" means the Securities Act of 1933, as it may
be amended and any successor act thereto.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 3.06 Ca).
15
"Senior Bank" means a "Bank" as defined in the Senior Credit
Facility.
"Senior Bank Obligations" means (i) the principal of each loan
made under the Senior Credit Facility, (ii) all reimbursement and cash
collateralization obligations in respect of letters of credit issued under the
Senior Credit Facility, (iii) all monetary obligations of the Company or any
Subsidiary under each Senior Interest Rate Agreement (as defined in the Senior
Credit Facility) entered into (x) prior to the Closing Date with any
counterparty that was a Senior Bank (or an Affiliate thereof) on the Closing
Date or (y) on or after the Closing Date with any counterparty that was a Senior
Bank (or an Affiliate thereof) at the time such Senior Interest Rate Agreement
was entered into, (iv) all interest on the loans, letter of credit reimbursement
and other obligations under the Senior Credit Facility or such Senior Interest
Rate Agreements (including, without limitation) any interest which accrues after
the commencement of any case, proceeding or other action relating to the
bankruptcy, insolvency or reorganization of the Company or any Subsidiary
Guarantor, whether or not allowed or allowable as a claim in such proceeding),
(v) all other amounts payable by the Company under the Senior Loan Documents and
(vi) all increases, renewals, extensions and refinancings of the foregoing;
provided, however, that the principal amount of the indebtedness under the
Senior Credit Facility included in the Senior Bank Obligations shall not exceed
the maximum amount from time to time permitted to be outstanding by the
Intercreditor Agreement as in effect on the Closing Date.
"Senior Bank Parties" means each party to the Senior Credit
Facility other than any Obligor, each counterparty to a Senior Interest Rate
Agreement, the beneficiaries of each indemnification obligation undertaken by
the Company or any other Obligor under any Senior Loan Document, and the
successors and permitted assigns of each of the foregoing.
"Senior Collateral" means all the "Senior Collateral" as
defined in any Senior Collateral Document and shall also include the mortgaged
properties described in the Senior Credit Facility and the proceeds thereof.
"Senior Collateral Agent" means Citicorp USA, Inc., in its
capacity as Senior Collateral Agent under the Senior Collateral Documents, and
its successors.
"Senior Collateral Disposition" means (i) any sale, transfer
or other disposition of Senior Collateral (including any property or assets that
would constitute Senior Collateral but for the release of the Senior Lien and
the Second Priority Lien with respect thereto in connection with such sale,
transfer or other disposition), other than a Permitted Disposition (as defined
in the Collateral Documents), or (ii) a Casualty/Condemnation with respect to
Senior Collateral.
"Senior Collateral Documents" means the Senior Mortgages, the
Senior Subsidiary Security Agreement, the Senior Subsidiary Guarantee Agreement,
the Senior Indemnity, Subrogation and Contribution Agreement, the Intercreditor
Agreement and each of the mortgages, security agreements and other instruments
and documents executed and delivered by any Subsidiary Guarantor pursuant to any
of the foregoing or pursuant to the Senior Credit Facility or for purposes of
16
providing collateral security or credit support for any Senior Obligation or
obligation under the Senior Subsidiary Guarantee Agreement.
"Senior Credit Facility" means the Senior Credit Agreement,
dated as of June 27, 2001 (as amended, modified, supplemented or Refinanced from
time to time), among the Company, the Senior Banks and the Senior Collateral
Agent.
"Senior Debt Documents" means the Senior Loan Documents and
the 10.50% Note Documents.
"Senior Facilities" means the Senior Credit Facility and the
10.50% Note Indenture.
"Senior Indemnity, Subrogation and Contribution Agreement"
means the Senior Indemnity, Subrogation and Contribution Agreement, dated as of
June 27, 2001 among the Company, the Subsidiary Guarantors (including Subsidiary
Guarantors becoming party thereto after the Closing Date) and the Senior
Collateral Agent.
"Senior Lien" means the liens on the Senior Collateral in
favor of the Senior Secured Parties under the Senior Collateral Documents.
"Senior Loan Documents" means the Senior Credit Facility, the
Notes referred to in the Senior Credit Facility, each Senior Interest Rate
Agreement, and the Senior Collateral Documents.
"Senior Mortgages" means the mortgages, deeds of trust,
leasehold mortgages, assignments of leases and rents, modifications and other
security documents delivered pursuant to the Senior Credit Agreement.
"Senior Obligations" means (a) the Senior Bank Obligations and
(b) the 10.5% Note Obligations.
"Senior Secured Parties" means (a) the Senior Bank Parties and
(b) the 10.5% Note Parties.
"Senior Subsidiary Guarantee Agreement" means the Senior
Subsidiary Guarantee Agreement, made by the Subsidiary Guarantors (including
Subsidiary Guarantors that become parties thereto after the Closing Date) in
favor of the Senior Collateral Agent for the benefit of the Senior Parties.
"Senior Subsidiary Security Agreement" means the Senior
Subsidiary Security Agreement, made by the Subsidiary Guarantors (including
Subsidiary Guarantors that become parties thereto after the Closing Date) in
favor of the Senior Collateral Agent for the benefit of the Senior Secured
Parties.
"Shelf Registration Statement" means a shelf registration
statement under the Securities Act filed by the Company, if required by, and
meeting the requirements of, the Exchange and Registration Rights Agreement,
registering Original Securities for resale.
17
"Specified Debt Financings" means the Additional Senior Second
Priority Debt, the Additional Second Priority Debt and any Debt or Attributable
Debt permitted by Section 5.20(i) of the Senior Credit Facility.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by Trustee pursuant to Section 3.08.
"Stated Maturity" means, with respect to any Security, the
date specified in such Security as the fixed date on which the final payment of
principal of such Security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency unless such contingency has occurred).
"Subsidiary" of any Person means (i) a corporation more than
50% of the combined voting power of the outstanding Voting Stock of which is
owned, directly or indirectly, by such Person or by one or more other
Subsidiaries of such Person or by such Person and one or more Subsidiaries
thereof or (ii) any other Person (other than a corporation) in which such
Person, or one or more other Subsidiaries of such Person or such Person and one
or more other Subsidiaries thereof, directly or indirectly, has at least a
majority ownership and power to direct the policies, management and affairs
thereof.
"Subsidiary Guarantor" means each Subsidiary that is party to
the Senior Subsidiary Guarantee Agreement, the Second Priority Subsidiary
Guarantee Agreement or any other Senior Collateral Document or Second Priority
Collateral Document.
"Successor Security" of any particular Security means every
Security issued after, and evidencing all or a portion of the same debt as that
evidenced by, such particular Security; and, for the purpose of this definition,
any Security authenticated and delivered under Section 3.07 in exchange for or
in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Synthetic Lease" means a lease which is treated as an
operating lease under generally accepted accounting principles but as ownership
of the leased asset by the lessee for purposes of the Internal Revenue Code.
"Synthetic Lease Documents" means the documents governing the
Synthetic Lease Facility.
"Synthetic Lease Facility" means the Synthetic Lease entered
into by Rite Aid Realty Corp. and guaranteed by Rite Aid on the Closing Date
having an aggregate discounted present value of approximately $107,000,000.
18
"Synthetic Lease Obligations" means all rent and supplemental
rent, all fees and all other expenses or amounts payable by Rite Aid Realty
Corp. or Rite Aid to any Synthetic Lease Parties under any Synthetic Lease
Document.
"Synthetic Lease Parties" means all parties to the Synthetic
Lease Documents other than the Obligors.
"10.50% Note Documents" means the 10.50% Notes and the 10.50%
Note Indenture and Exchange and Registration Rights Agreement among the State
Street Bank and Trust Company, as trustee, Rite Aid and the Subsidiary
Guarantors.
"10.50% Note Indenture" means the Indenture dated as of June
14, 2000, among Rite Aid, the Subsidiary Guarantors and State Street Bank and
Trust Company, as trustee, relating to the 10.50% Notes.
"10.50% Note Obligation Payment Date" means the date on which
all 10.50% Note Obligations have been paid in full.
"10.50% Note Obligations" means (i) all principal of and
interest (including, without limitation, any interest which accrues after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Company, whether or not allowed or allowable
as a claim in any such proceeding) on the 10.50% Notes, (ii) all other amounts
payable by the Company to the 10.50% Note Parties under the 10.50% Note
Documents, and (iii) any renewals or extensions of any of the foregoing.
"10.50% Note Parties" means the holders from time to time of
the 10.50% Notes, the trustee under the 10.50% Note Indenture and the
beneficiaries of each indemnification obligation undertaken by Rite Aid or any
other Obligor under any 10.50% Note Document, but shall not include the Obligors
or any controlled Affiliate thereof.
"10.50% Notes" means the 10.50% Senior Secured Notes Due 2002
of Rite Aid issued pursuant to the 10.50% Note Indenture prior to the Closing
Date and any Registered Equivalent Notes issued in exchange therefor.
"Triggering Event" means (x) the occurrence of any Event of
Default and, as a result thereof, (A) the acceleration (including any automatic
acceleration in connection with any Bankruptcy Proceeding) of the principal
amount of any Senior Obligations or Second Priority Debt Obligations under the
terms of any Senior Loan Document or any Second Priority Debt Document or (B)
the commencement of the exercise of remedies in respect of Collateral, and (y)
in either case, receipt by the Second Priority Collateral Trustee of written
notice thereof from the Senior Collateral Agent (in the case of any such Event
of Default arising under the Senior Debt Documents) or receipt by the Senior
Collateral Agent and the Second Priority Collateral Trustee of written notice
thereof from any Second Priority Representative (in the case of any such Event
of Default arising under any Second Priority Debt Document)
19
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed, except as
provided in Section 9.05; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after such date, "Trust Indenture Act" means,
to the extent required by any such amendment, the Trust Indenture Act of 1939 as
so amended.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Unrestricted Subsidiary" means (a) any Subsidiary which, in
accordance with the provisions of this Indenture, has been designated by a Board
Resolution as an Unrestricted Subsidiary, in each case unless and until such
Subsidiary shall, in accordance with the provisions of this Indenture, be
designated by Board Resolution as a Restricted Subsidiary; and (b) any
Subsidiary a majority of the Voting Stock of which shall at the time be owned
directly or indirectly by one or more Unrestricted Subsidiaries.
"U.S. Government Obligations" means securities which are (i)
direct obligations of the United States of America for the payment of which its
full faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as custodian with
respect to any such obligation evidenced by such depository receipt or a
specific payment of interest on or principal of any such obligation held by such
custodian for the account of the holder of a depository receipt; provided that
(except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt from
any amount received by the custodian in respect of the obligation set forth in
(i) or (ii) above or the specific payment of interest on or principal of such
obligation evidenced by such depository receipt
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
"Voting Stock" of any Person means Capital Stock of such
Person which ordinarily has voting power for the election of directors (or
persons performing similar functions) of such Person, whether at all times or
only so long as no senior class of securities has such voting power by reason of
any contingency.
"Wholly-owned Restricted Subsidiary" means a Restricted
Subsidiary of which at least 99% of the outstanding Voting Stock (other than
directors' qualifying shares) is at the time, directly or indirectly, owned by
the Company, or by one or more Wholly-owned Restricted Subsidiaries, or by the
Company and one or more Wholly-owned Restricted Subsidiaries.
20
SECTION 1.02. Compliance Certification and Opinions. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee such
certificates and opinions as may be required by the Trustee under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirement set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(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 each such individual,
he has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered To Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
21
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 1.04. Acts of Holders; Record Date. (a) Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Holders may be embodied in
and evidenced by one or more instruments of substantially similar tenor signed
by such Holders in person or by agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are received by the Trustee and, where it is
hereby expressly required, to the Company. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "Act." of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 6.01)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
(c) The Company may, in the circumstances permitted by the
Trust Indenture Act, fix any day as the record date for the purpose of
determining the Holders entitled to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action, or to vote on
any action, authorized or permitted to be given or taken by Holders. If not set
by the Company prior to the first solicitation of a Holder made by any Person in
respect of any such action, or, in the case of any such vote, prior to such
vote, the record date for any such action or vote shall be the 30th day (or, if
later, the date of the most recent list of Holders required to be provided
pursuant to Section 7.01) prior to such first solicitation or vote, as the case
may be. With regard to any record date, only the Holders on such date (or their
duly designated proxies) shall be entitled to give or take, or vote on, the
relevant action.
(d) The ownership of Securities shall be proved by the
Security Register.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
22
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.
SECTION 1.05. Notices, Etc., To Trustee and the Company. Any
request, demand, authorization, direction, notice, consent, waiver or Act of
Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust
Office, Attention: Corporate Trust Administration, or
(2) the Company or any Subsidiary Guarantor by the Trustee or
by any Holder shall be sufficient for every purpose hereunder
(unless otherwise herein expressly provided) if in writing and
mailed, first-class postage prepaid, to the Company addressed to it
at the address of its principal office specified in the first
paragraph of this instrument or at any other address previously
furnished in writing to the Trustee by the Company.
SECTION 1.06. Notice To Holders; Waiver. Where this Indenture
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at his
address as it appears in the Security Register, not later than the latest date
(if any), and not earlier than the earliest date (if any), prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed,
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Indenture provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
SECTION 1.07. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act, that is required under such Act to be part
of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
23
may be. Until such time as this Indenture shall be qualified under the Trust
Indenture Act, this Indenture, the Company and the Trustee shall be deemed for
all purposes hereof to be subject to and governed by the Trust Indenture Act to
the same extent as would be the case if this Indenture were so qualified on the
date hereof.
SECTION 1.08. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.09. Successors and Assigns. All covenants and
agreements in this Indenture by the Company or any Subsidiary Guarantor shall
bind its successors and assigns, whether so expressed or not.
SECTION 1.10. Separability Clause. In case any provision in
this Indenture or in the Securities shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 1.11. Benefits of Indenture. Nothing in this Indenture
or in the Securities, express or implied, shall give to any Person, other than
the parties hereto and their successors hereunder and the Holders of Securities,
any benefit or any legal or equitable right, remedy or claim under this
Indenture.
SECTION 1.12. Governmental Law. This Indenture and the
Securities shall be governed by and construed in accordance with the laws of the
State of New York without regard to the conflicts of laws principles thereof.
SECTION 1.13. Legal Holidays. In any case where any Interest
Payment Date, Redemption Date or Stated Maturity of any Security shall not be a
Business Day, then (notwithstanding any other provision of this Indenture or of
the Securities) payment of interest or principal (and premium, if any) need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the Interest Payment Date, or Redemption
Date, or at the Stated Maturity, as the case may be, provided that no interest
shall accrue for the period from and after such Interest Payment Date,
Redemption Date or Stated Maturity, as the case may be.
ARTICLE II
Security Forms
SECTION 2.01. Forms Generally; Initial Forms of Exempt
Securities. The Securities and the Trustee's certificates of authentication
shall be in substantially the forms set forth in this Article, with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture, and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon as
may be required to comply with the rules of any securities exchange or as may,
24
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of the Securities.
Upon their original issuance, the Exempt Securities shall be
issued in the form of one or more Global Securities without interest coupons
registered in the name of DTC, as Depositary, or its nominee and deposited with
the Trustee, as custodian for DTC, in New York, New York, for credit by DTC to
the respective accounts of beneficial owners of the Securities represented
thereby (or such other accounts as they may direct). Such Global Securities,
together with their Successor Securities which are Global Securities, are
collectively herein called the "Restricted Global Securities".
SECTION 2.02. Form of Face of Security. [If the Security is a
Restricted Security, then insert - - THIS SECURITY HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. THE
HOLDER (I) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE OF THIS SECURITY OR THE LAST DATE ON WHICH THIS SECURITY WAS
HELD BY THE COMPANY OR ANY AFFILIATE OF THE COMPANY RESELL OR OTHERWISE TRANSFER
THIS SECURITY EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) SO LONG
AS THE SECURITIES ARE ELIGIBLE FOR RESALE UNDER RULE 144A, TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER
EXEMPTION FROM REGISTRATION PROVIDED UNDER THE SECURITIES ACT (IF AVAILABLE);
AND (II) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION
WITH ANY TRANSFER OF THIS CERTIFICATE (UNLESS THIS CERTIFICATE IS HELD IN GLOBAL
FORM) WITHIN TWO YEARS (OR SUCH SHORTER PERIOD AS MAY BE PRESCRIBED BY RULE
144(k) (OR ANY SUCCESSOR PROVISION) UNDER THE SECURITIES ACT) AFTER THE LATER OF
THE ORIGINAL ISSUANCE OF THIS SECURITY OR THE LAST DATE ON WHICH THIS SECURITY
WAS HELD BY THE COMPANY OR ANY AFFILIATE OF THE COMPANY, THE HOLDER MUST CHECK
THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF
SUCH TRANSFER AND SUBMIT THIS SECURITY TO THE TRUSTEE. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS
SECURITY IN VIOLATION OF THE FOREGOING RESTRICTIONS; AND
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
ISSUER THAT THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY
25
ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN
THE ABOVE PARAGRAPH.
THIS SECURITY WILL NOT BE ACCEPTED FOR REGISTRATION OF
TRANSFER UNLESS THE REGISTRAR OR TRANSFER AGENT IS SATISFIED THAT THE
RESTRICTIONS ON TRANSFER SET FORTH ABOVE HAVE BEEN COMPLIED WITH, ALL AS
PROVIDED IN THE INDENTURE.]
[If the Security is a Global Security, then insert - - THIS
SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.
THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY
REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]
[If the Security is a Global Security and The Depository Trust
Company is to be the Depositary therefor, then insert - - UNLESS THIS SECURITY
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
RITE AID CORPORATION
$___,000,000...... 12.50% Senior Secured Notes due 2006
No. CUSIP: ______
Rite Aid Corporation, a Delaware corporation (hereinafter
called the "Company"), for value received, hereby promises to pay to CEDE & CO.
or registered assigns, the principal sum set forth on Schedule A hereof on
September 15, 2006, in such coin or currency of the United States of America as
at the time of payment shall be legal tender for the payment of public and
private debts, and to pay interest, semi-annually on March 15 and September 15
of each year (each, an "Interest Payment Date"), on said principal sum at a rate
of 12.50% per annum, at such office or agency, in like coin or currency, from
the March 15 or September 15, as the case may be, to which interest on the
26
Securities has been paid preceding the date hereof (unless the date hereof is a
March 15 or a September 15 to which interest has been paid, in which case from
the date hereof, or unless the date hereof is prior to any interest having been
paid, in which case from June 27, 2001) until payment of said principal sum has
been made or duly provided for. If the Company shall default in the payment of
interest when due on such March 15 or September 15, then this Security shall
bear interest from the next preceding date to which interest has been paid, or,
if no interest has been paid, from June 27, 2001. The interest so payable on any
March 15 or September 15 shall be paid to the person in whose name this Security
shall be registered at the close of business on the fifteenth calendar day
(whether or not a Business Day) immediately preceding the related Interest
Payment Date (each, a "Regular Record Date"). For purposes of this Security,
"Business Day" means any day other than a Saturday, a Sunday or a day on which
banking institutions in The City of New York, New York, Hartford, Connecticut or
Boston, Massachusetts are authorized or obligated by law, regulation, executive
order or governmental decree to be closed.
If and to the extent the Company shall default in the payment
of the interest due on any interest payment date, such defaulted interest shall
be paid to the person in whose name this Security is registered at the close of
business on a record date established for such payment by notice by or on behalf
of the Company to the holders of the Securities mailed by first-class mail not
less than fifteen days prior to such record date to their last address as they
shall appear upon the Security register, such record date to be not less than
five days preceding the date of payment of such defaulted interest. The Company
may pay interest by check mailed to the holder's address as it appears on the
Security register.
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof and such further provisions shall for
all purposes have the same effect as though fully set forth at this place.
This Security shall not be valid or become obligatory for any
purpose until the certificate of authentication hereon shall have been executed
by the Trustee under the Indenture referred to on the reverse hereof.
IN WITNESS WHEREOF, the Company has caused this Security to be
signed by its duly authorized officers and has caused its corporate seal to be
affixed hereunto.
RITE AID CORPORATION,
By: ___________________________
Title:
27
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the
within-mentioned Indenture.
STATE STREET BANK AND TRUST
COMPANY, as Trustee,
---------------------------
Authorized Officer
28
Form of Reverse of Security
RITE AID CORPORATION
12.50% Senior Secured Notes due 2006
Indenture. (a) This Security is the duly authorized issue of
debt securities of the Company (herein referred to as the "Securities"), all
issued or to be issued under and pursuant to an indenture, dated as of June 27,
2001 (as amended, modified and supplemented from time to time, the "Indenture"),
among the Company, certain Subsidiaries of the Company party thereto (the
"Subsidiary Guarantors") and State Street Bank and Trust Company, as Trustee
(herein referred to as the "Trustee"), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Company, the Subsidiary Guarantors and the holders (the words
"holders", "holder", "Securityholders" or "Securityholder" mean the registered
holder(s)) of the Securities.
This Security is the 12.50% Senior Secured Notes due 2006 of
the Company and is limited in aggregate principal amount to $152,025,000.
All capitalized terms used in this Security which are defined
in the Indenture and not otherwise defined herein shall have the meanings
assigned to them in the Indenture.
Certain Covenants. The Indenture restricts the Company's and
each of the Subsidiary Guarantor's ability to merge, consolidate or sell
substantially all of its assets. In addition, the Company is obliged to abide by
certain covenants, including covenants limiting the amount of debt it may incur,
as well as its ability to enter into sale and leaseback transactions, a covenant
requiring it to maintain its material properties, and a covenant requiring it to
pay or discharge all taxes, all as more fully described in the Indenture. All of
such covenants are subject to the covenant defeasance procedures outlined in the
Indenture.
In the event of certain sales, transfers, or other
dispositions of, or casualties or other insured damages to, or any takings under
power of eminent domain or by condemnation or similar proceedings of, certain
assets that constitute Collateral, under certain circumstances, a portion of the
proceeds of such sales, transfers, dispositions, casualties or condemnations
shall be deposited into an account held by the Trustee in accordance with the
terms of the Indenture. When the proceeds in such account exceed $10,000,000,
the Company shall make an offer to purchase the Securities in accordance with
the terms of the Indenture.
Guarantees; Security. To guarantee the due and punctual
payment of the principal and interest on the Securities and all other amounts
payable by the Company under the Indenture and the Securities when and as the
same shall be due and payable, whether at maturity, by acceleration or
otherwise, according to the terms of the Securities and the Indenture, the
29
Subsidiary Guarantors have, subject to certain limitations, jointly and
severally guaranteed such payment obligations pursuant to the terms of the
Second Priority Subsidiary Guarantee Agreement.
The guarantees under the Second Priority Subsidiary Guarantee
Agreement are secured by Second Priority Liens on the Collateral pursuant to the
terms of the Second Priority Collateral Documents. The Second Priority Liens
will be shared equally and ratably with future lenders under the Additional
Second Priority Debt Facilities, if any, as and to the extent provided in the
Second Priority Subsidiary Guarantee Agreement, the Second Priority Collateral
Documents and the Intercreditor Agreement. The actions of the holders of any
debt (including, but not limited to, the Securities) secured by such Second
Priority Liens and the application of proceeds from the enforcement of any
remedies with respect to such Collateral are limited pursuant to the terms of
the Collateral Documents and the Intercreditor Agreement.
Effect of Event of Default. If an Event of Default shall have
occurred and be continuing under the Indenture, the principal hereof may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
Amendments and Waivers. Modifications and amendments of the
Indenture will be permitted to be made only with the consent of the holders of
not less than a majority in principal amount of all outstanding Securities
issued under the Indenture that are affected by such modification or amendment;
provided that no such modification or amendment may, without the consent of the
holder of each such Security affected thereby, (a) change the stated maturity of
the principal of, or any installment of interest or principal on, any such
Security; (b) reduce the principal of, or the rate or amount of interest on, or
any amount payable upon redemption of, any such Security, or adversely affect
any right of repayment of the holder of any such Security; (C) change the place
of payment, or the coin or currency, for payment of principal of or interest on
any such Security; (d) impair the right to institute suit for the enforcement of
any payment on or with respect to any such Security; (e) reduce the above-stated
percentage of outstanding Securities necessary to modify or amend the Indenture,
or to waive compliance with certain provisions thereof or certain defaults and
consequences thereunder; (f) release any security interest that may have been
granted in favor of the Holders, other than in accordance with the terms of the
applicable Second Priority Collateral Document governing the grant of such
security interest or the Intercreditor Agreement that are in effect on the
Closing Date; provided, however, that to the extent (i) the applicable terms of
such agreements cross-reference the terms of the Second Priority Debt Documents
and (ii) all of the Second Priority Debt Obligations, other than the Exchange
Note Obligations, have been paid in full, such cross-references shall refer to
the terms of the Second Priority Debt Documents, other than the Exchange Note
Documents, that were in effect as of the Closing Date; (g) make any change in
any Second Priority Collateral Document or any change in this Indenture with
respect to the Collateral that would adversely affect the Holders, except for
any such change made in accordance with the terms of the Intercreditor Agreement
or the applicable Collateral Documents, as the case may be, that are in effect
on the Closing Date; provided, however, that to the extent (i) the applicable
30
terms of such agreements cross-reference the terms of the Second Priority Debt
Documents and (ii) all of the Second Priority Debt Obligations, other than the
Exchange Note Obligations, have been paid in full, such cross-references shall
refer to the terms of the Second Priority Debt Documents, other than the
Exchange Note Documents, that were in effect as of the Closing Date; (h) reduce
the Redemption Price payable upon the redemption of any Securities or change the
time at which any Securities may be redeemed; or (i) modify any of the foregoing
provisions or any of the provisions relating to the waiver of certain past
defaults or certain covenants, except to increase the required percentage to
effect such action or to provide that certain other provisions may not be
modified or waived without the consent of the holder of such Security.
Modifications and amendments of the Indenture will be
permitted to be made by the Company and the Trustee without the consent of any
holder of Securities for any of the following purposes: (a) to evidence the
succession of another person to the Company as obligor under the Indenture; (b)
to add to the covenants, agreements and obligations of the Company for the
benefit of the holders of all Securities or to surrender any right or power
conferred upon the Company in the Indenture; (c) to provide for the acceptance
of appointment by a successor Trustee or facilitate the administration of the
trusts under the Indenture by more than one Trustee; (d) to cure any ambiguity,
defect or inconsistency in the Indenture; (e) to add guarantees with respect to
the Securities or to secure the Securities; or (f) to make any other change that
does not adversely affect the rights of any Holder of Securities.
Denominations; Transfer. (a) The Securities are issuable in
registered form without coupons in denominations of $1,000 and any integral
multiple thereof.
A certificate in global form representing all or a portion of
the Securities may not be transferred except as a whole by the Depositary to a
nominee of such Depositary or by a nominee of such Depositary to such Depositary
or another nominee of such Depositary or by such Depositary or any such nominee
to a successor Depositary for such Securities or a nominee of such successor
Depositary.
No Liability of Certain Persons. No past, present or future
stockholder, employee, officer or director of the Company or any successor
thereof shall have any liability for any obligation, covenant or agreement of
the Company contained under this Security or the Indenture. Each holder by
accepting this Security waives and releases all such liability. This waiver and
release are part of the consideration for the issue of this Security.
GOVERNING LAW. THE LAWS OF THE STATE OF NEW YORK GOVERN THE
INDENTURE AND THIS SECURITY.
31
SCHEDULE A
SCHEDULE OF CHANGES IN OUTSTANDING PRINCIPAL AMOUNT
The following notations in respect of changes in the
outstanding principal amount of this Security have been made:
Change in
Initial Outstanding Outstanding
Principal Principal Principal
Date Amount Xxxxxx Xxxxxx Notation
---- ------ ------ ------ --------
32
ARTICLE III
The Securities
SECTION 3.01. Title and Terms. The Securities shall be known
and designated as the "12.50% Senior Secured Notes due 2006". The aggregate
amount of Securities which may be authenticated and delivered hereunder is
limited to $152,025,000, except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Securities
pursuant to Section 3.04, 3.05 or 9.06.
Unless the context otherwise requires, the Original Securities
and the Exchange Securities shall constitute Securities for all purposes under
the Indenture, including with respect to any amendment, waiver, acceleration or
other Act of Holders or redemption.
SECTION 3.02. Denominations. The Securities shall be issuable
only in registered form without coupons and only in denominations of $1,000 and
integral multiples thereof.
SECTION 3.03. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman of the
Board, its Vice Chairman, its President, one of its Vice Presidents or its
Secretary. The signature of any of these officers on the Securities may be
manual or facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities; and the Trustee in accordance
with such Company Order shall authenticate and make available for delivery such
Securities as provided in this Indenture and not otherwise.
At any time and from time to time after the execution and
delivery of this Indenture and after the effectiveness of a registration
statement under the Securities Act with respect thereto, the Company may deliver
Exchange Securities executed by the Company to the Trustee for authentication,
together with a Company Order for the authentication and delivery of such
Exchange Securities and a like principal amount of Original Securities for
cancellation in accordance with this Indenture, and the Trustee in accordance
with the Company Order shall authenticate and make available for delivery such
Securities. Prior to authenticating such Exchange Securities, and accepting any
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, if requested, and (subject to Section
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6.01) shall be fully protected in relying upon, an Opinion of Counsel stating in
substance:
(a) that all conditions hereunder precedent to the
authentication and delivery of such Exchange Securities have been
complied with and that such Exchange Securities, when such
Securities have been duly authenticated and delivered by the Trustee
(and subject to any other conditions specified in such Opinion of
Counsel), have been duly issued and delivered and will constitute
valid and legally binding obligations of the Company, enforceable in
accordance with their terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and
to general equity principles; and
(b) that the issuance of the Exchange Securities in exchange
for Original Securities has been effected in compliance with the
Securities Act.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by manual signature, and such certificate upon
any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder.
SECTION 3.04. Temporary Securities. Pending the preparation of
definitive Securities, the Company may execute, and upon Company Order the
Trustee shall, as soon as practicable thereafter, authenticate and deliver,
temporary Securities, which Securities are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution thereof. If temporary Securities are issued, the
Company will cause definitive Securities to be prepared without unreasonable
delay. After the preparation of definitive Securities, the temporary Securities
shall be exchangeable for definitive Securities upon surrender of the temporary
Securities at any office or agency of the Company designated pursuant to Section
10.02, without charge to the Holder. Upon receipt of notice of surrender for
cancellation of any one or more temporary Securities the Company shall execute
and the Trustee shall, as soon as practicable thereafter, authenticate and make
available for delivery in exchange therefor a like principal amount of
definitive Securities of authorized denominations. Until so exchanged the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.
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SECTION 3.05. Global Securities. (a) Each Global Security
authenticated under this Indenture shall be registered in the name of the
Depositary designated by the Company for such Global Security or a nominee
thereof and delivered to such Depositary or a nominee thereof or custodian
therefor, and each such Global Security shall constitute a single Security for
all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no
Global Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security or a
nominee thereof unless (i) such Depositary (A) has notified the Company that it
is unwilling or unable to continue as Depositary for such Global Security or (B)
has ceased to be a clearing agency registered as such under the Exchange Act,
and in either case the Company fails to appoint a successor Depositary, (ii) the
Company executes and delivers to the Trustee a Company Order stating that it
elects to cause the issuance of the Securities in certificated form and that all
Global Securities shall be exchanged in whole for Securities that are not Global
Securities (in which case such exchange shall be effected by the Trustee) or
(iii) there shall have occurred and be continuing an Event of Default with
respect to the Securities.
(c) If any Global Security is to be exchanged for other
Securities or canceled in whole, it shall be surrendered by or on behalf of the
Depositary or its nominee to the Trustee, as Security Registrar, for exchange or
cancellation as provided in this Article III. If any Global Security is to be
exchanged for other Securities or canceled in part, or if another Security is to
be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for
exchange or cancellation as provided in this Article III or (ii) the principal
amount thereof shall be reduced or increased by an amount equal to the portion
thereof to be so exchanged or canceled, or equal to the principal amount of such
other Security to be so exchanged for a beneficial interest therein, as the case
may be, by means of an appropriate adjustment made on the records of the
Trustee, as Security Registrar, whereupon the Trustee, in accordance with the
Applicable Procedures, shall instruct the Depositary or its authorized
representative to make a corresponding adjustment to its records. Upon receipt
of notice of any such surrender or adjustment of a Global Security, the Trustee
shall, subject to Section 3.06(c) and as otherwise provided in this Article III,
as soon as practicable thereafter, authenticate and deliver any Securities
issuable in exchange for such Global Security (or any portion thereof) to or
upon the order of, and registered in such names as may be directed by, the
Depositary or its authorized representative. Upon the request of the Trustee in
connection with the occurrence of any of the events specified in the preceding
paragraph, the Company shall promptly make available to the Trustee a reasonable
supply of Securities that are not in the form of Global Securities. The Trustee
shall be entitled to rely upon any order, direction or request of the Depositary
or its authorized representative which is given or made pursuant to this Article
III if such order, direction or request is given or made in accordance with the
Applicable Procedures.
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(d) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global Security
or any portion thereof, whether pursuant to this Article III or otherwise, shall
be authenticated and delivered in the form of, and shall be, a Global Security,
unless such Security is registered in the name of a Person other than the
Depositary for such Global Security or a nominee thereof.
(e) The Depositary or its nominee, as registered owner of a
Global Security, shall be the Holder of such Global Security for all purposes
under the Indenture and the Securities and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members.
SECTION 3.06. Registration, Registration of Transfer and
Exchange; Restricted Securities Legends. (a) Registration, Registration of
Transfer and Exchange Generally. The Company shall cause to be kept at the
Corporate Trust Office of the Trustee a register (the register maintained in
such office and in any other office or agency of the Company designated pursuant
to Section 10.02 being herein sometimes collectively referred to as the
"Security Register") in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Securities and of
transfers and exchanges of Securities. The Trustee is hereby appointed "Security
Registrar" for the purpose of registering Securities and transfers and exchanges
of Securities as herein provided. Such Security Register shall distinguish
between Original Securities and Exchange Securities.
Upon surrender for registration of transfer of any Security at
an office or agency of the Company designated pursuant to Section 10.02 for such
purpose, the Company shall execute, and the Trustee shall, as soon as
practicable thereafter, authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of any authorized
denominations, of a like aggregate principal amount and bearing such restrictive
legends as may be required by this Indenture.
At the option of the Holder, and subject to the other
provisions of this Section 3.06, Securities may be exchanged for other
Securities of any authorized denominations, of a like aggregate principal amount
and bearing such restrictive legends as may be required by this Indenture upon
surrender of the Securities to be exchanged at any such office or agency.
Whenever any Securities are so surrendered for exchange, the Company shall
execute, and the Trustee shall, as soon as practicable thereafter, authenticate
and make available for delivery, the Securities which the Holder making the
exchange is entitled to receive.
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and (except for the differences between Original Securities and
Exchange Securities provided for herein) entitled to the same benefits under
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this Indenture, as the Securities surrendered upon such registration of transfer
or exchange.
Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Security
Registrar) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed, by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Sections 3.03, 3.04, 3.05, 3.06, or 9.06 not
involving any transfer.
(b) Certain Transfers and Exchanges. Notwithstanding any other
provision of this Indenture or the Securities, transfers and exchanges of
Securities and beneficial interests in a Global Security of the kinds specified
in this Section 3.06(b) shall be made only in accordance with this Section
3.06(b).
(i) Exchanges between Global Security and Non-Global Security.
A beneficial interest in a Global Security may be exchanged for a
Security that is not a Global Security as provided in Section 3.05;
provided that, if such interest is a beneficial interest in a
Restricted Global Security, then such interest shall be exchanged
for a Restricted Security (subject in each case to Section 3.06(c)).
(c) Restricted Securities Legends. Exempt Securities and their
respective Successor Securities shall bear a Restricted Securities Legend,
subject to the following:
(i) subject to the following clauses of this Section 3.06(c),
a Security or any portion thereof which is exchanged, upon transfer
or otherwise, for a Global Security or any portion thereof shall
bear the Restricted Securities Legend borne by such Global Security
while represented thereby;
(ii) subject to the following clauses of this Section 3.06(c),
a new Security which is not a Global Security and is issued in
exchange for another Security (including a Global Security) or any
portion thereof, upon transfer or otherwise, shall bear the
Restricted Securities Legend borne by such other Security;
(iii) Exchange Securities shall not bear a Restricted
Securities Legend;
(iv) at any time after the Securities may be freely
transferred without registration under the Securities Act or without
being subject to transfer restrictions pursuant to the Securities
Act, a new Security which does not bear a Restricted Securities
Legend may be issued in exchange for or in lieu of a Security (other
than a Global Security) or any portion thereof which bears such a
legend if the Trustee has received an unlegended Security, duly
executed by the Holder of such legended Security or his attorney
37
duly authorized in writing, and after such date and receipt of such
certificate, the Trustee shall, as soon as practicable thereafter,
authenticate and deliver such a new Security in exchange for or in
lieu of such other Security as provided in this Article III;
(v) a new Security which does not bear a Restricted Securities
Legend may be issued in exchange for or in lieu of a Security (other
than a Global Security) or any portion thereof which bears such a
legend if, in the Company's judgment, placing such a legend upon
such new Security is not necessary to ensure compliance with the
registration requirements of the Securities Act, and the Trustee, at
the direction of the Company, shall authenticate and deliver such a
new Security as provided in this Article III; and
(vi) notwithstanding the foregoing provisions of this Section
3.06(c), a Successor Security of a Security that does not bear a
particular form of Restricted Securities Legend shall not bear such
form of legend unless the Company has reasonable cause to believe
that such Successor Security is a "restricted security" within the
meaning of Rule 144, in which case the Trustee, at the direction of
the Company, shall authenticate and deliver a new Security bearing a
Restricted Securities Legend in exchange for such Successor Security
as provided in this Article III.
SECTION 3.07. Mutilated, Destroyed, Lost and Stolen
Securities. If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall, as soon as practicable thereafter,
authenticate and deliver in exchange therefor a new Security of like tenor and
principal amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by either of them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Company or the Trustee that such Security has been acquired by a
bona fide purchaser, the Company shall execute and upon its request the Trustee
shall, as soon as practicable thereafter, authenticate and deliver, in lieu of
any such destroyed, lost or stolen Security, a new Security of like tenor and
principal amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
38
Every new Security issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.08. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest.
Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their
respective Predecessor Securities) are registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Security and the date of the
proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Trustee for such deposit prior
to the date of the proposed payment, such money when deposited to be
held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this clause provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted
Interest which shall be not more than 15 days and not less than 10
days prior to the date of the proposed payment and not less than 10
days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be
mailed, first-class postage prepaid, to each Holder at his address
as it appears in the Security Register, not less than 10 days prior
to such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been
so mailed, such Defaulted Interest shall be paid to the Persons in
whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on such Special
Record Date and shall no longer be payable pursuant to the following
clause (2).
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(2) The Company may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities may be listed, and
upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment
pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 3.09. Persons Deemed Owners. Prior to due presentment
of a Security for registration of transfer, the Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name such
Security is registered as the owner of such Security for the purpose of
receiving payment of principal of (and premium, if any) and (subject to Section
3.08) interest on such Security and for all other purposes whatsoever, whether
or not such Security be overdue, and neither the Company, the Trustee nor any
agent of the Company or the Trustee shall be affected by notice to the contrary.
None of the Company, the Trustee or any agent of the Company
or the Trustee shall have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of a Security in global form, or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
Notwithstanding the foregoing, with respect to any Security in global form,
nothing herein shall prevent the Company or the Trustee, or any agent of the
Company or the Trustee, from giving effect to any written certification, proxy
or other authorization furnished by any Depositary (or its nominee), as a
Holder, with respect to such Security in global form or impair, as between such
Depositary and owners of beneficial interests in such Security in global form,
the operation of customary practices governing the exercise of the rights of
such Depositary (or its nominee) as Holder of such Security in global form.
SECTION 3.10. Cancellation. All Securities surrendered for
payment, redemption, registration of transfer or exchange shall, if surrendered
to any Person other than the Trustee, be delivered to the Trustee and shall be
promptly canceled by the Trustee. The Company may at any time deliver to the
Trustee for cancellation any Securities previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and all
Securities so delivered shall be promptly canceled by the Trustee. No Securities
shall be authenticated in lieu of or in exchange for any Securities canceled as
provided in this Section, except as expressly permitted by this Indenture. All
canceled Securities held by the Trustee shall be disposed of by the Trustee in
accordance with its customary procedures.
SECTION 3.11. Computation of Interest. Interest on the
Securities shall be computed on the basis of a 360 day year of twelve 30-day
months.
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SECTION 3.12. Cusip Numbers. The Company in issuing the
Securities may use "CUSIP" numbers (if then generally in use), and, if so, the
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; provided that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Trustee of any change in the "CUSIP"
numbers.
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01. Satisfaction and Discharge of Indenture. This
Indenture shall cease to be of further effect (except as to (i) rights of
registration of transfer and exchange and the Company's right of optional
redemption, (ii) substitution of apparently mutilated, defaced, destroyed, lost
or stolen Securities, (iii) rights of Holders to receive payment of principal
and interest on the Securities, (iv) rights, obligations and immunities of the
Trustee under the Indenture and (v) rights of the Holders of the Securities as
beneficiaries of the Indenture with respect to any property deposited with the
Trustee payable to all or any of them), and the Trustee, on demand of and at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and
delivered (other than (i) Securities which have been
destroyed, lost or stolen and which have been replaced or paid
as provided in Section 3.07 and (ii) Securities for whose
payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as
provided in Section 10.03) have been delivered to the Trustee
for cancellation; or
(B) all such Securities not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the
name, and at the expense, of the Company, and the
Company, in the case of (i), (ii) or (iii) above, has
41
deposited or caused to be deposited with the Trustee as
trust funds in trust for the purpose an amount sufficient
to pay and discharge the entire indebtedness on such
Securities not theretofore delivered to the Trustee for
cancellation, for principal (and premium, if any) and
interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the
Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied
with.
Notwithstanding the satisfaction and discharge of this Indenture pursuant to
this Section 4.01, the obligations of the Company to the Trustee under Section
6.07 and, if money shall have been deposited with the Trustee pursuant to
subclause (B) of clause (1) of this Section, the obligations of the Trustee
under Section 4.02 and the last paragraph of Section 10.03 shall survive.
SECTION 4.02. Application of Trust Money. Subject to the
provisions of the last paragraph of Section 10.03, all money deposited with the
Trustee pursuant to Section 4.01 shall be held in trust and applied by it, in
accordance with the provisions of the Securities 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 separated from other funds except to the extent required by law.
ARTICLE V
Remedies
SECTION 5.01. Events of Default. "Event of Default", wherever
used herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) failure to pay the principal of (or premium, if any, on)
any Security at its Maturity; or
(2) failure to pay any interest upon any Security when it
becomes due and payable, and continuance of such default for a
period of 30 days; or
42
(3) failure of the Company or any of the Subsidiary Guarantors
to perform or comply with the provisions of Section 8.01 or
(4) failure to perform any other covenant or agreement of the
Company or any of the Subsidiary Guarantors in this Indenture or the
Securities (other than a covenant or warranty a default in whose
performance or whose breach is elsewhere in this Section
specifically dealt with), and continuance of such default or breach
for a period of 60 days after there has been given, by registered or
certified mail, to the Company or such Subsidiary Guarantor, as the
case may be, by the Trustee or to the Company or such Subsidiary
Guarantor, as the case may be, and the Trustee by the Holders of at
least 10% in principal amount of the Outstanding Securities a
written notice specifying such default or breach and requiring it to
be remedied and stating that such notice is a "Notice of Default"
hereunder; or
(5) a default under any bond, debenture, note or other
evidence of indebtedness of the Company or under any mortgage,
indenture or instrument under which there may be issued or by which
there may be secured or evidenced any indebtedness of the Company,
whether such indebtedness now exists or shall hereafter be created,
which default shall constitute a failure to pay an aggregate
principal amount exceeding $10,000,000 of such indebtedness when due
and payable after the expiration of any applicable grace period with
respect thereto and shall have resulted in such indebtedness in an
aggregate principal amount exceeding $10,000,000 becoming or being
declared due and payable prior to the date on which it would
otherwise have become due and payable, without such indebtedness
having been discharged, or such acceleration having been rescinded
or annulled, within a period of 10 days after there shall have been
given, by registered or certified mail, to the Company by the
Trustee or to the Company and the Trustee by the Holders of at least
10% in principal amount of the Outstanding Securities a written
notice specifying such default and requiring the Company to cause
such indebtedness to be discharged or cause such acceleration to be
rescinded or annulled and stating that such notice is a "Notice of
Default" hereunder; provided, however, that if such default under
such bond, debenture, note, mortgage, indenture or other instrument
or evidence of indebtedness shall be remedied or cured by the
Company or waived pursuant to such agreement or instrument, then,
unless the maturity of the Securities shall have been accelerated as
provided herein, the Event of Default hereunder by reason thereof
shall be deemed likewise to have been thereupon remedied, cured or
waived without further action upon the part of either the Trustee or
the Holders; or
(6) any event of default or condition shall occur under the
Second Priority Facilities which results in the acceleration of the
maturity of any of the Second Priority Facilities or permits the
lenders under any of the Second Priority Facilities, or any Person
acting on such Person's behalf, to accelerate the maturity thereof,
and such event or condition has continued for a period of 25 days
after the occurrence thereof; provided, however, that if such event
of default or condition under such Second Priority Facility shall be
remedied or cured by the Company or waived pursuant to such
agreement or instrument, then, unless the maturity of the Securities
shall have been accelerated as provided herein, the Event of Default
hereunder by reason thereof shall be deemed likewise to have been
thereupon remedied, cured or waived without further action upon the
part of either the Trustee or the Holders; or
43
(7) the entry by a court having jurisdiction in the premises
of (A) a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or (B) a
decree or order adjudging the Company a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the
Company under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or
other similar official of the Company or of any substantial part of
its property, or ordering the winding up or liquidation of its
affairs, and the continuance of any such decree or order for relief
or any such other decree or order unstayed and in effect for a
period of 60 consecutive days; or
(8) the commencement by the Company of a voluntary case or
proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or of any other case
or proceeding to be adjudicated a bankrupt or insolvent, or the
consent by it to the entry of a decree or order for relief in
respect of the Company in an involuntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any
bankruptcy or insolvency case or proceeding against it, or the
filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable Federal or State law,
or the consent by it to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or similar official of
the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or the
admission by it in writing of its inability to pay its debts
generally as they become due and its willingness to have a case
commenced against it or to seek an order for relief under the
Bankruptcy Code or any applicable bankruptcy, insolvency or other
similar law or the taking of corporate action by the Company in
furtherance of any such action; or
(9) any guarantee under the Second Priority Subsidiary
Guarantee Agreement ceases to be in full force and effect (other
than in accordance with the terms of this Indenture and the Second
Priority Subsidiary Guarantee Agreement) or any Subsidiary Guarantor
denies or disaffirms its obligations under the Second Priority
Subsidiary Guarantee Agreement; or
(10) the material impairment of the security interests under
the Second Priority Collateral Documents for any reason other than
the satisfaction in full of all obligations thereunder and under
this Indenture and discharge of the Second Priority Collateral
Documents and this Indenture, or any security interest created
44
hereunder or thereunder being declared invalid or unenforceable, or
the Company or any of its Subsidiaries asserting, in any pleading in
any court of competent jurisdiction, that any such security interest
is invalid or unenforceable.
SECTION 5.02. Acceleration of Maturity; Rescission and
Annulment. If an Event of Default (other than an Event of Default specified in
Section 5.01(7) or (8) occurs and is continuing, then and in every such case the
Holders of not less than 25% in aggregate principal amount of the Outstanding
Securities may direct the Trustee to declare all of the Securities to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee),
and upon any such declaration such principal and any accrued interest, if any,
shall become immediately due and payable. If an Event of Default specified in
Section 5.01(7) or (8) occurs, the principal and any accrued interest, on the
Securities then Outstanding shall ipso facto become immediately due and payable
without any declaration or other Act on the part of the Trustee or any Holder.
At any time after such a declaration of acceleration has been
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article provided, the Holders of
a majority in aggregate principal amount of the Outstanding Securities, by
written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if
(i) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities,
(B) the principal of (and premium, if any, on) any
Securities which have become due otherwise than by such
declaration of acceleration and, to the extent that payment of
such interest is lawful, interest thereon at the rate provided
by the Securities,
(C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate provided by
the Securities, and
(D) all sums paid or advanced by the Trustee hereunder
and the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel;
and
(ii) all Events of Default, other than the non-payment of the
principal of Securities which have become due solely by such
declaration of acceleration, have been cured or waived as provided
in Section 5.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
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SECTION 5.03. Collection of Indebtedness and Suits for
Enforcement by Trustee. The Company covenants that if
(1) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof, the
Company will, upon demand of the Trustee, pay to it, for the benefit
of the Holders of such Securities, the whole amount then due and
payable on such Securities for principal (and premium, if any) and
interest, and, to the extent that payment of such interest shall be
legally enforceable, interest on any overdue principal (and premium,
if any) and on any overdue interest, at the rate provided by the
Securities, if any, and, in addition thereto, 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.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any other obligor upon the Securities
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon the
Securities, wherever situated.
If an Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights
of the Holders by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 5.04. Trustee May File Proofs of Claim. In case of any
judicial proceeding relative to the Company or any other obligor upon the
Securities, or upon the property of the Company or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official 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 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 6.07.
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No provision of this Indenture 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 Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 5.05. Trustee May Enforce Claims Without Possession of
Securities. All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 5.06. Application of Money Collected. Any money
collected by the Trustee pursuant to this Article shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money on account of principal (or premium, if any) or
interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 6.07; and
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Securities in
respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Securities for
principal (and premium, if any) and interest, respectively.
SECTION 5.07. Limitation on Suits. No Holder of any Security
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in aggregate principal
amount of the Outstanding Securities shall have made written request
to the Trustee to institute proceedings in respect of such Event of
Default in its own name as Trustee hereunder;
(3) such Holder or Holders have agreed to indemnify the
Trustee against the costs, expenses and liabilities to be incurred
in compliance with such request;
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(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders
of a majority in aggregate principal amount of the Outstanding
Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 5.08. Unconditional Right of Holders To Receive
Principal, Premium and Interest. Notwithstanding any other provision in this
Indenture, the Holder of any Security shall have the right, which is absolute
and unconditional, to receive payment of the principal of (and premium, if any)
and (subject to Section 3.08) interest on such Security on the respective Stated
Maturities expressed in such Security (or, in the case of redemption, on the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such rights shall not be impaired without the consent of such Holder.
SECTION 5.09. Restoration of Rights and Remedies. If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders shall be restored severally
and respectively to their former positions hereunder and thereafter all rights
and remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative. Except as
otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities in the last paragraph of Section 3.07, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not Waiver. No delay or
omission of the Trustee or of any Holder of any Security to exercise any right
or remedy accruing upon any Event of Default shall impair any such right or
remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Trustee
or to the Holders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Holders, as the case may be.
48
SECTION 5.12. Control by Holders. The Holders of a majority in
aggregate principal amount of the Outstanding Securities shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee; provided that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 5.13. Waiver of Past Defaults. The Holders of not less
than a majority in aggregate principal amount of the Outstanding Securities may
on behalf of the Holders of all the Securities waive any past default hereunder
and its consequences, except a default
(1) in the payment of the principal of (or premium, if any) or
interest on any Security, or
(2) in respect of a covenant or provision hereof which under
Article IX cannot be modified or amended without the consent of the
Holder of each Outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
SECTION 5.14. 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, suffered or omitted by it as Trustee, a court
may require any party litigant in such suit to file an undertaking to pay the
costs of such suit, and may assess costs against any such party litigant,
including attorney's fees and expenses in the manner and to the extent provided
in the Trust Indenture Act; provided, that neither this Section nor the Trust
Indenture Act shall be deemed to authorize any court to require such an
undertaking or to make such an assessment in any suit instituted by the Trustee
or the Company.
SECTION 5.15. Waiver of Stay or Extension Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law and covenants
that it will not hinder, delay or impede the execution of any power herein
49
granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
SECTION 5.16. Enforcement of Remedies. Notwithstanding any of
the foregoing, any enforcement of the guarantees under the Second Priority
Guarantee Agreement or any remedies with respect to the Second Priority
Collateral under the Second Priority Collateral Documents is subject to the
provisions of the Intercreditor Agreement.
ARTICLE VI
The Trustee
SECTION 6.01. Certain Duties and Responsibilities. Except
during the continuance of an Event of Default, the duties and responsibilities
of the Trustee shall be as provided by the Indenture. During the existence of an
Event of Default, the Trustee will exercise such rights and powers vested in it
under the Indenture and use the same degree of care and skill in its exercise as
a prudent person would exercise under the circumstances in the conduct of such
person's own affairs. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it. Whether or not therein expressly
so provided, every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
SECTION 6.02. Notice of Defaults. The Trustee shall give the
Holders notice of any default hereunder as and to the extent provided by the
Trust Indenture Act; provided, however, that in the case of any default of the
character specified in Section 5.01(4), no such notice to Holders shall be given
until at least 30 days after the occurrence thereof. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default.
SECTION 6.03. Certain Rights of Trustee. Subject to the
provisions of Section 6.01:
(a) the Trustee may conclusively rely and shall be protected
in acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order and any
50
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith on
its part, rely upon an Officers' Certificate or opinion;
(d) the Trustee may consult with counsel of its selection and
the advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders pursuant to this Indenture, unless such Holders
shall have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by the Trustee in
compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by agent
or attorney;
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and the Trustee shall not be responsible for, and shall be
fully protected from, any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder;
(h) the Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably believed by
it to be authorized or within the discretion or rights or powers conferred upon
it by this Indenture;
(i) the Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible Officer of the Trustee has
actual knowledge thereof or unless written notice of any event which is in fact
such a default is received by the Trustee at the Corporate Trust Office of the
Trustee, and such notice references the Securities and this Indenture;
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(j) the rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and to each agent, custodian and other Person
employed to act hereunder; and
(k) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by the Intercreditor Agreement or any of
the Second Priority Collateral Documents with respect to voting or approving any
amendments, consents or waivers in connection with such agreements unless the
approval of such amendment, consent or waiver would not otherwise be so
determined without the vote of the Trustee.
SECTION 6.04. Not Responsible for Recitals or Issuance of
Securities. The recitals contained herein and in the Securities except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture, the Second Priority Subsidiary Guarantee Agreement or of the
Securities. The Trustee shall not be accountable for the use or application by
the Company of Securities or the proceeds thereof.
SECTION 6.05. May Hold Securities. The Trustee, any Paying
Agent, any Security Registrar or any other agent of the Company, may become the
owner or pledgee of Securities and, subject to Sections 6.08 and 6.13, may
otherwise deal with the Company with the same rights it would have if it were
not Trustee, Paying Agent, Security Registrar or such other agent.
SECTION 6.06. Money Held in Trust. Money held by the Trustee
in trust hereunder need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed in writing with the
Company.
SECTION 6.07. Compensation and Reimbursement. The Company and
each Subsidiary Guarantor, jointly and severally, agrees
(1) to pay to the Trustee from time to time such compensation
as shall be agreed in writing between the Company and the Trustee
for all services rendered by it hereunder (which compensation shall
not be limited by any provision of law in regard to the compensation
of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture, including, but not
limited to the costs incurred in connection with collection
(including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense
disbursement or advance as may be attributable to its negligence or
bad faith; and
52
(3) to indemnify the Trustee and its agents, employees,
officers, directors and shareholders for, and to hold the same
harmless against, any and all loss, liability damage, claim or
expense, including, without limitation, reasonable attorney's fees
and expenses, and taxes (other than taxes based on the income of the
Trustee) incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or
administration of this trust, including the costs and expenses of
defending itself against or investigating any claim (including any
claim by the Company) or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
The Trustee shall have a lien prior to the Securities as to
all property and funds held by it hereunder for any amount owing it or any
predecessor Trustee pursuant to this Section 6.07, except with respect to funds
held in trust for the benefit of the Holders of particular Securities.
When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.01(7) or Section
5.01(8), the expenses (including the reasonable charges and expenses of its
counsel) and the compensation for the services are intended to constitute
expenses of administration under any applicable Federal or State bankruptcy,
insolvency or other similar law.
The provisions of this Section shall survive the resignation
or removal of the Trustee and/or the satisfaction and discharge or termination
of this Indenture.
SECTION 6.08. Disqualification; Conflicting Interest. If the
Trustee has or shall acquire a conflicting interest within the meaning of the
Trust Indenture Act, the Trustee shall either eliminate such interest or resign,
to the extent and in the manner provided by, and subject to the provisions of,
the Trust Indenture Act and this Indenture.
SECTION 6.09. Corporate Trustee Required; Eligibility. There
shall at all times be a Trustee hereunder which shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000. If such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Person shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
SECTION 6.10. Resignation and Removal; Appointment of
Successor. (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign at any time with respect to the
Securities by giving written notice thereof to the Company. If an instrument of
53
acceptance by a successor Trustee shall not have been delivered to the Trustee
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the
Holders of a majority in aggregate principal amount of the Outstanding
Securities, delivered to the Trustee and to the Company. If an instrument of
acceptance by a successor Trustee shall not have been delivered to the Trustee
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee with respect to such
Securities.
(d) If at any time:
(i) the Trustee shall fail to comply with Section 6.08 after
written request therefor by the Company or by any Holder who has
been a bona fide Holder of a Security for at least six months, or
(ii) the Trustee shall cease to be eligible under Section 6.09
and shall fail to resign after written request therefor by the
Company or by any such Holder, or
(iii) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 5.14, any Holder who has been a bona fide
Holder of a Security for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee with respect
to such Securities.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, the Company, by a Board Resolution, shall promptly appoint a
successor Trustee. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee shall be
appointed by Act of the Holders of a majority in aggregate principal amount of
the Outstanding Securities delivered to the Company and the retiring Trustee,
the successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment, become the successor Trustee and supersede the successor Trustee
appointed by the Company. If no successor Trustee shall have been so appointed
by the Company or the Holders and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a Security for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee.
54
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders of Securities in the manner provided in Section 1.06. Each notice shall
include the name of the successor Trustee and the address of its Corporate Trust
Office.
SECTION 6.11. Acceptance of Appointment by Successor. Every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder. Upon request of any such successor Trustee and the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts.
No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.
SECTION 6.12. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION 6.13. Preferential Collection of Claims Against
Company. If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company or any such other obligor).
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ARTICLE VII
Holders' Lists and Reports by Trustee and Company
SECTION 7.01. Company To Furnish Trustee Names and Addresses
of Holders. The Company will furnish or cause to be furnished to the Trustee
(a) semi-annually, not more than 15 days after each Regular
Record Date, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders of Securities as of such Regular Record Date,
and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the time
such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
SECTION 7.02. Preservation of Information; Communications to
Holders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders of Securities
contained in the most recent list furnished to the Trustee as provided in
Section 7.01 and the names and addresses of Holders of Securities received by
the Trustee in its capacity as Security Registrar. The Trustee may destroy any
list furnished to it as provided in Section 7.01 upon receipt of a new list so
furnished.
(b) The rights of Holders of Securities to communicate with
other Holders of Securities with respect to their rights under this Indenture or
under the Securities and the corresponding rights and duties of the Trustee,
shall be provided by the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any agent of either of them shall be held accountable by reason of
any disclosure of information as to the names and addresses of Holders made
pursuant to the Trust Indenture Act.
SECTION 7.03. Reports by Trustee. (a) The Trustee shall
transmit to Holders of Securities such reports concerning the Trustee and its
actions under this Indenture as may be required pursuant to the Trust Indenture
Act at the times and in the manner provided pursuant thereto. If required by
Section 313(a) of the Trust Indenture Act, the Trustee shall, within sixty days
after each May 15, following the date of this Indenture deliver to Holders of
Securities a brief report, dated as of such May 15, which complies with the
provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which the Securities are listed, with the Commission and with the Company. The
Company will promptly notify the Trustee when the Securities are listed on any
stock exchange or of any delisting thereof.
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SECTION 7.04. Reports by Company. On and after August 1, 2001,
the Company shall file with the Trustee and the Commission, and transmit to
Holders of Securities, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with Commission pursuant
to Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee
within 30 days after the same is so required to be filed with the Commission.
Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
ARTICLE VIII
Consolidation, Merger, Conveyance, Transfer or Lease
SECTION 8.01. Company and the Subsidiary Guarantors May
Consolidate, Etc., Only on Certain Terms. (a) The Company shall not consolidate
with or merge into any other corporation or convey, transfer or lease its
properties and assets substantially as an entirety to any Person, and the
Company shall not permit any Person to consolidate with or merge into the
Company or convey, transfer or lease its properties and assets substantially as
an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into
another corporation or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, the corporation
formed by such consolidation or into which the Company is merged or
the Person which acquires by conveyance or transfer, or which
leases, the properties and assets of the Company substantially as an
entirety shall be a corporation organized and existing under the
laws of the United States of America, any State thereof or the
District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the
principal of (and premium, if any) and interest on all the
Securities and the performance of every covenant of this Indenture
on the part of the Company to be performed or observed by
supplemental indenture satisfactory in form to the Trustee, executed
and delivered to the Trustee by the Person (if other than the
Company) formed by such consolidation or into which the Company
shall have been merged or by the corporation which shall have
acquired the Company's assets;
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(2) immediately after giving effect to such transaction and
treating any indebtedness which becomes an obligation of the Company
or a Subsidiary as a result of such transaction as having been
incurred by the Company or such Subsidiary at the time of such
transaction, no Event of Default, and no event which, after notice
or lapse of time or both, would become an Event of Default, shall
have happened and be continuing with respect to any Securities;
(3) if, as a result of any such consolidation or merger or
such conveyance, transfer or lease, properties or assets of the
Company would become subject to a mortgage, pledge, lien, security
interest or other encumbrance which would not be permitted by this
Indenture, the Company or such successor corporation or Person, as
the case may be, shall take such steps as shall be necessary
effectively to secure the Securities of each sites equally and
ratably with (or prior to) all indebtedness secured thereby; and
(4) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article
and that all conditions precedent herein provided for relating to
such transaction have been complied with.
(b) Except as otherwise provided in the Second Priority
Subsidiary Guarantee Agreement, the Company shall not permit any Subsidiary
Guarantor to consolidate with or merge into any other corporation or convey,
transfer or lease its properties and assets substantially as an entirety to any
Person, and the Company shall not permit any Person to consolidate with or merge
into any Subsidiary Guarantor or convey, transfer or lease its properties and
assets substantially as an entirety to any Subsidiary Guarantor, unless:
(1) in case such Subsidiary Guarantor shall consolidate with
or merge into another corporation or convey, transfer or lease its
properties and assets substantially as an entirety to any Person,
the corporation formed by such consolidation or into which such
Subsidiary Guarantor is merged or the Person which acquires by
conveyance or transfer, or which leases, the properties and assets
of such Subsidiary Guarantor substantially as an entirety shall be a
corporation organized and existing under the laws of the United
States of America, any State thereof or the District of Columbia and
shall expressly assume, by a supplement to the Second Priority
Subsidiary Guarantee Agreement and an indenture supplemental hereto,
executed and delivered to the Trustee, in form satisfactory to the
Trustee, the due and punctual performance and observance of all
obligations of such Subsidiary Guarantor under the Second Priority
Subsidiary Guarantee Agreement and the performance of every covenant
of this Indenture on the part of such Subsidiary Guarantor to be
performed or observed by supplemental indenture satisfactory in form
to the Trustee, executed and delivered to the Trustee by the Person
(if other than such Subsidiary Guarantor) formed by such
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consolidation or into which such Subsidiary Guarantor shall have
been merged or by the corporation which shall have acquired such
Subsidiary Guarantor's assets;
(2) immediately after giving effect to such transaction and
treating any indebtedness which becomes an obligation of such
Subsidiary Guarantor as a result of such transaction as having been
incurred by such Subsidiary Guarantor at the time of such
transaction, no Event of Default, and no event which, after notice
or lapse of time or both, would become an Event of Default, shall
have occurred and be continuing with respect to any Securities;
(3) if, as a result of any such consolidation or merger or
such conveyance, transfer or lease, properties or assets of such
Subsidiary Guarantor would become subject to a mortgage, pledge,
lien, security interest or other encumbrance which would not be
permitted by this Indenture, such Subsidiary Guarantor or such
successor corporation or Person, as the case may be, shall take such
steps as shall be necessary effectively to secure the Securities of
each sites equally and ratably with (or prior to) all indebtedness
secured thereby; and
(4) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article
and that all conditions precedent herein provided for relating to
such transaction have been complied with.
SECTION 8.02. Successor Substituted. Upon any consolidation of
the Company or any Subsidiary Guarantor with, or merger of the Company or any
Subsidiary Guarantor into, any other Person or any transfer, conveyance, sale,
lease or other disposition of all or substantially all of the properties and
assets of the Company or any Subsidiary Guarantor as an entirety in accordance
with Section 8.01, the successor Person shall succeed to, and be substituted
for, and may exercise every right and power of, the Company or such Subsidiary
Guarantor, as the case may be, under this Indenture and the Second Priority
Subsidiary Guarantee Agreement with the same effect as if such successor Person
had been named as the Company or such Subsidiary Guarantor, as the case may be,
herein, and thereafter, except in the case of a lease, the predecessor Person
shall be relieved of all obligations and covenants under this Indenture, the
Securities and the Second Priority Subsidiary Guarantee Agreement.
Such successor Person may cause to be signed, and may issue
either in its own name or in the name of the Company prior to such succession,
any or all of the Securities issuable hereunder which theretofore shall not have
been signed by the Company and delivered to the Trustee; and, upon the order of
such successor corporation instead of the Company and subject to all the terms,
conditions and limitations in this Indenture prescribed, the Trustee shall
authenticate and shall deliver any Securities which previously shall have been
signed and delivered by the officers of the Company to the Trustee for
authentication pursuant to such provisions and any Securities which such
successor corporation thereafter shall cause to be signed and delivered to the
Trustee on its behalf for that purpose pursuant to such provisions. All
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Securities so issued in all respects have the same legal rank and benefit under
this Indenture as Securities theretofore or thereafter issued in accordance with
the terms of this Indenture as though all such Securities had been issued prior
to the date of such succession. In case of any such consolidation, merger, sale
or conveyance, such changes in phraseology and form may be made in the
Securities thereafter to be issued as may be appropriate.
ARTICLE IX
Supplemental Indentures
SECTION 9.01. Supplemental Indentures Without Consent of
Holders. Without the consent of any Holders, the Company, when authorized by a
Board Resolution of the Company, any of the Subsidiary Guarantors and the
Trustee, at any time and from time to time, may enter into one or more
indentures supplemental hereto, in form satisfactory to the Trustee, for any of
the following purposes:
(1) to evidence the succession of another Person to the
Company or to any Subsidiary Guarantor and the assumption by any
such successor of the covenants of the Company or such Subsidiary
Guarantor, as the case may be, herein and in the Securities; or
(2) to add to the covenants of the Company or any of the
Subsidiary Guarantors for the benefit of the Holders of Securities,
or to surrender any right or power herein conferred upon the Company
or any of the Subsidiary Guarantors; or
(3) to add Subsidiary Guarantors with respect to the
Securities or to secure the Securities; or
(4) to comply with any requirements of the Commission in order
to effect and maintain the qualification of this Indenture under the
Trust Indenture Act; or
(5) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture which shall not be
inconsistent with the provisions of this Indenture, provided such
action pursuant to this clause (5) shall not adversely affect the
interests of the Holders of Securities in any material respect.
SECTION 9.02. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in principal amount
of the Outstanding Securities affected by such supplemental indenture (voting as
one class), by Act of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution of the Company, the Subsidiary
Guarantors and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
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any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders of Securities under this
Indenture; provided, however, that no such supplemental indenture shall, without
the consent of the Holder of each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any
installment of interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium
payable thereon, or change the place of payment where, or the coin
or currency in which, any Security or any premium or the interest
thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity
thereof, or
(2) reduce the percentage in principal amount of the
Outstanding Securities, the consent of whose Holders is required for
any such supplemental indenture, or the consent of whose Holders is
required for any waiver (of compliance with certain provisions of
this Indenture or certain defaults hereunder and their consequences)
provided for in this Indenture, or
(3) release any security interest that may have been granted
in favor of the Holders, other than in accordance with the terms of
the Collateral Documents or the Intercreditor Agreement that are in
effect on the Closing Date; provided, however, that to the extent
(i) the applicable terms of such agreements cross-reference the
terms of the Second Priority Debt Documents and (ii) all of the
Second Priority Debt Obligations, other than the Exchange Note
Obligations, have been paid in full, such cross-references shall
refer to the terms of the Second Priority Debt Documents, other than
the Exchange Note Documents, that were in effect as of the Closing
Date, or
(4) make any change in any Second Priority Collateral Document
or any change in this Indenture with respect to the Collateral that
would adversely affect the Holders, except for any such change made
in accordance with the terms of the Intercreditor Agreement or the
applicable Collateral Document, as the case may be, that are in
effect on the Closing Date; provided, however, that to the extent
(i) the applicable terms of such agreements cross-reference the
terms of the Second Priority Debt Documents and (ii) all of the
Second Priority Debt Obligations, other than the Exchange Note
Obligations, have been paid in full, such cross-references shall
refer to the terms of the Second Priority Debt Documents, other than
the Exchange Note Documents, that were in effect as of the Closing
Date, or
(5) reduce the Redemption Price payable upon the redemption of
any Securities or change the time at which any Securities may be
redeemed, or
(6) modify any of the provisions of this Section 9.02 or
Section 10.17, except to increase any such percentage or to provide
that certain other provisions of this Indenture cannot be modified
or waived without the consent of the Holder of each Outstanding
Security affected thereby.
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It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
SECTION 9.03. Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 6.01) shall be fully protected in relying upon, an Opinion
of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
SECTION 9.04. Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article, this Indenture shall
be modified in accordance therewith, and such supplemental indenture shall form
a part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.
SECTION 9.05. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act.
SECTION 9.06. Reference in Securities to Supplemental
Indentures. Securities authenticated and delivered after the execution of any
supplemental indenture relating to Securities pursuant to this Article may, and
shall if required by the Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities.
ARTICLE X
Covenants
SECTION 10.01. Payment of Principal, Premium and Interest. The
Company will duly and punctually pay the principal of (and premium, if any) and
interest on the Securities in accordance with the terms of the Securities and
this Indenture.
SECTION 10.02. Maintenance of Office or Agency. The Company
will maintain in the Borough of Manhattan, The City of New York, an office or
agency where Securities may be presented or surrendered for payment, where
Securities may be surrendered for registration of transfer or exchange and where
notices and demands to or upon the Company in respect of the Securities 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
62
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more
other offices or agencies (in or outside the Borough of Manhattan, The City of
New York) where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, The City of New York, for such purposes. The Company 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.
SECTION 10.03. Money for Security Payments To Be Held in
Trust. If the Company shall at any time act as its own Paying Agent, it will, on
or before each due date of the principal or interest on any of the Securities,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal (and premium, if any) or interest so
becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and will promptly notify the Trustee of its action or
failure so to act.
Whenever the Company shall have one or more Paying Agents, it
will, prior to each due date of the principal of (and premium, if any) or
interest on Securities, deposit with a Paying Agent a sum sufficient to pay the
principal (and premium, if any) or interest so becoming due, such sum to be held
in trust for the benefit of the Persons entitled to such principal, premium or
interest, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in which such Paying
Agent shall agree with the Trustee, subject to the provisions of this Section,
that such Paying Agent will:
(1) hold all sums held by it for the payment of the principal
of (and premium, if any) or interest on Securities in trust for the
benefit of the Persons entitled thereto until such sums shall be
paid to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or
any other obligor upon the Securities) in the making of any payment
of principal (and premium, if any) or interest; and
(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by such Paying Agent.
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The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
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 (and
premium, if any) or interest on any Security and remaining unclaimed for two
years after such principal (and premium, if any) or interest has become due and
payable shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, 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, shall 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 a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in The City of New York, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication, any unclaimed balance of such money then
remaining will be repaid to the Company.
SECTION 10.04. Corporate Existence. Subject to Article VIII,
the Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its existence, rights (charter and statutory) and
franchises; provided, however, that the Company shall not be required to
preserve any such right or franchise if the Board of Directors in good faith
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and that the loss thereof is not
disadvantageous in any material respect to the Holders.
SECTION 10.05. Maintenance of Properties. The Company will
cause all properties used or useful in the conduct of its business or the
business of any Subsidiary of the Company to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements, all as in the judgment of the Company may be
necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company from discontinuing the
operation or maintenance of any of such properties if such discontinuance is, as
determined by the Board of Directors in good faith, desirable in the conduct of
its business or the business of any Subsidiary of the Company and not
disadvantageous in any material respect to the Holders.
SECTION 10.06. Payment of Taxes and Other Claims. The Company
will pay or discharge or cause to be paid or discharged, before the same shall
become delinquent, (1) all taxes, assessments and governmental charges levied or
64
imposed upon the Company or any of its Subsidiaries or upon the income, profits
or property of the Company or any of its Subsidiaries, and (2) all lawful claims
for labor, materials and supplies which, if unpaid, might by law become a lien
upon the property of the Company or any of its Subsidiaries; provided, however,
that the Company shall not be required to pay or discharge or cause to be paid
or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
SECTION 10.07. Insurance. The Company covenants and agrees
that it will, and will cause each Subsidiary to, insure and keep insured, with
reputable insurance companies, their principal properties, and such insurance
shall be in such amounts (and with such deductibles) as companies engaged in a
similar business in accordance with good business practice customarily insure
properties of a similar character against loss by fire and from other causes or,
in lieu thereof, in the case of itself or of any one or more of its
Subsidiaries, it will maintain or cause to be maintained a program of
self-insurance in accordance with good business practices.
SECTION 10.08. Restrictions on Funded Debt of Restricted
Subsidiaries. The Company covenants and agrees that it will not permit any
Restricted Subsidiary to create, issue, incur, assume, or many other way become
liable for any unsecured Funded Debt unless the Company would be entitled under
subparagraph (e) of Section 10.10 of this Indenture to create, issue, incur,
assume or guarantee any Secured Debt not specifically permitted under Section
10.10 of this Indenture but for subparagraph (e) thereof in an amount equal to
such Funded Debt; provided, however, that the foregoing restriction shall not
prevent (i) any Restricted Subsidiary from becoming liable to the Company or to
a Wholly-owned Restricted Subsidiary for Funded Debt or (ii) the extension,
renewal or refunding of any Funded Debt of any Restricted Subsidiary so long as
Consolidated Funded Debt is not thereby increased.
SECTION 10.09. Restriction on Sales with Leases Back. Except
for a sale or transfer by a Restricted Subsidiary to the Company or a
Wholly-owned Restricted Subsidiary, the Company covenants and agrees that it
will not, and will not permit any Restricted Subsidiary to, sell or transfer any
manufacturing plant, warehouse, retail store or equipment owned and operated or
hereafter owned and operated by the Company or a Restricted Subsidiary, with the
intention that the Company or any Restricted Subsidiary take back a lease
thereof, except a lease for a period, including renewals, not exceeding 24
months, by the end of which period it is intended that the use of such property
or equipment by the lessee will be discontinued (any such transaction being
herein referred to as a "Sale and Leaseback Transaction" ); provided,
notwithstanding the foregoing, the Company or any Restricted Subsidiary may
enter into a Sale and Leaseback Transaction if the Company or a Restricted
Subsidiary would be entitled under subparagraph (e) of Section 10.10 to create,
issue, incur, assume or guarantee any Secured Debt not specifically permitted
under Section 10.10 of this Indenture but for subparagraph (e) thereof in an
amount equal to the Attributable Debt respecting such Sale and Leaseback
Transaction; provided further that, notwithstanding the foregoing, the Company
or any Restricted Subsidiary may enter into a Sale and Leaseback Transaction if
entered into in respect of property acquired by the Company or a Restricted
65
Subsidiary if such Sale and Leaseback Transaction is entered into within 24
months from the date of such acquisition; and provided further that,
notwithstanding the foregoing, the Company or any Restricted Subsidiary may
enter into a Sale and Leaseback Transaction if the Company, within 120 days
before or after the sale or transfer shall have been made by the Company or by
any Restricted Subsidiary, applied or applies an amount equal to the greater of
(i) the net proceeds of the sale of the property sold and leased back pursuant
to such arrangement or (ii) the fair market value of the property so sold and
leased back at the time of entering into such arrangement (as determined by any
two of the following: the Chairman of the Board of the Company, its Chief
Executive Officer, its President, any Vice President of the Company, its
Treasurer and its Controller) to the retirement of Secured Debt of the Company
other than at maturity or pursuant to any mandatory sinking fund payment or any
mandatory prepayment provision.
SECTION 10.10. Restrictions on Secured Debt. The Company
covenants and agrees that it will not, and will not permit any Restricted
Subsidiary to, create, issue, incur, assume or guarantee any Secured Debt
without making effective provision (and the Company covenants that in such case
it will make or cause to be made effective provision) whereby the Securities
then Outstanding and any other indebtedness of or guaranteed by the Company or
such Restricted Subsidiary then entitled thereto, shall be secured by such
mortgage, pledge, lien or encumbrance equally and ratably with (or prior to) any
and all other obligations and indebtedness thereby secured for so long as any
such other obligations and indebtedness shall be so secured; provided, however,
that the foregoing covenants shall not be applicable to the following:
(a) any mortgage, pledge, lien or other encumbrance on any
property that secures the Secured Obligations, in each case, in
accordance with the terms of the Collateral Documents that are in
effect on the Closing Date; provided that such mortgages, pledges,
liens or encumbrances are otherwise permitted under this Indenture,
the Second Priority Collateral Documents and the Intercreditor
Agreement.
(b) (i) any mortgage, pledge, lien or other encumbrance on any
property acquired or constructed by the Company or a Restricted
Subsidiary and created contemporaneously with, or within 24 months
after, such acquisition or the completion of such construction and
commencement of full operation of such property, whichever is later,
to secure or provide for the payment of any part of the purchase or
construction price of such property, or (ii) the acquisition by the
Company or a Restricted Subsidiary of property subject to any
mortgage, pledge, lien or other encumbrance upon such property
existing at the time of acquisition thereof, whether or not assumed
by the Company or such Restricted Subsidiary, or (iii) any
conditional sales agreement or other title retention agreement with
respect to any property hereafter acquired, provided that the lien
of any such mortgage, pledge, lien or other encumbrance or agreement
does not spread to other property except unimproved real property
previously owned upon which any new construction has taken place and
subsequent additions to such acquired or constructed property.
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(c) any mortgage, pledge, lien, or other encumbrance created
for the sole purposes of extending, renewing or refunding, in whole
or part, any mortgage, lien or other encumbrance permitted by this
Section 10.10 or any mortgage, pledge, lien or other encumbrance
securing the indebtedness of the Company or of any Restricted
Subsidiary on the date of this Indenture or of a corporation at the
time such corporation becomes a Subsidiary, or any extensions,
renewals or refundings of any such mortgage, pledge, lien or other
encumbrance; provided, however, that the principal amount of
indebtedness secured thereby shall not exceed the principal amount
of indebtedness so secured at the time of such extension, renewal or
refunding and that such extension, renewal or refunding mortgage,
pledge, lien or other encumbrance shall be limited to all or that
part of the same properties which secured the mortgage, pledge, lien
or other encumbrance extended, renewed or refunded.
(d) any Secured Debt of a Restricted Subsidiary owing to the
Company or a Wholly-owned Restricted Subsidiary.
(e) Secured Debt of the Company and its Restricted
Subsidiaries which would otherwise be prohibited by the foregoing
restrictions (not including Secured Debt permitted to be secured
under subparagraphs (a) through (d) above, so long as the sum of any
such Secured Debt hereafter incurred plus Attributable Debt of the
Company and any Restricted Subsidiaries in respect of existing Sale
and Leaseback Transactions hereafter entered into (excluding
Attributable Debt incurred in respect of any Sale and Leaseback
Transaction entered into in respect of property acquired by the
Company or a Restricted Subsidiary not more than 24 months prior to
the date such Transaction is entered into) plus unsecured Funded
Debt of any Restricted Subsidiary hereafter incurred (excluding
unsecured Funded Debt incurred through the extension, renewal or
refunding of Funded Debt where Consolidated Funded Debt was not
thereby increased and excluding any Funded Debt owed to the Company
or a Wholly-owned Restricted Subsidiary) does not at the time exceed
20% of Consolidated Net Tangible Assets.
SECTION 10.11. Restrictions on Impairment of Security
Interest. Neither the Company nor any Subsidiary of the Company is permitted to
take or omit to take any action that would materially impair the security
interest with respect to the Collateral for the benefit of the Trustee and the
Holders of the Securities, and neither the Company nor any Subsidiary is
permitted to grant to any person any security interest whatsoever in any of the
Collateral; provided, however, that the Company and such Subsidiaries may take
any such actions and grant any such security interests in accordance with the
Collateral Documents and the Intercreditor Agreement.
SECTION 10.12. Restrictions on Amendments to Collateral
Documents. Neither the Company nor any Subsidiary of the Company is permitted to
amend, waive or otherwise modify, or permit or consent to any amendment, waiver
or other modification of the Collateral Documents in any way that would be
adverse to the Holders of the Securities, except for any such amendment, waiver
or modification entered into in accordance with the terms of the Intercreditor
67
Agreement or the applicable Collateral Document, as the case may be, that are in
effect on the Closing Date.
SECTION 10.13. Future Subsidiary Guarantors. The Company shall
cause each Person that either (a) becomes a domestic Subsidiary following the
Closing Date or (b) otherwise becomes a Subsidiary Guarantor with respect to any
of the Secured Obligations, in each case, to execute and deliver a supplement to
the Second Priority Subsidiary Guarantee Agreement and the applicable Second
Priority Collateral Documents at the time such Person becomes a Subsidiary or
Subsidiary Guarantor, as the case may be.
SECTION 10.14. Application of Collateral Proceeds. (a) At any
time when the Company or any Subsidiary Guarantor receives proceeds from a
Senior Collateral Disposition (the "Collateral Proceeds"), the Collateral
Proceeds shall be applied in accordance with Section 4.05 of the Intercreditor
Agreement so that after giving effect to any required prepayment of the Senior
Obligations, the Synthetic Lease Obligations and the Additional Senior Second
Priority Obligations, if any, in connection with such Senior Collateral
Disposition in accordance with Section 4.05 of the Intercreditor Agreement, a
pro rata portion of such Collateral Proceeds will be allocated to repurchase the
Securities based on the outstanding principal amount of the Second Priority Debt
Obligations required to be prepaid with such proceeds, such amount to be
measured on the date of such Senior Collateral Disposition; provided, however,
that in the event any such Senior Collateral Disposition occurs following the
occurrence of a Triggering Event, whether the Holders shall be entitled to
prepayment shall be determined in accordance with the terms of the Second
Priority Collateral Documents and the Intercreditor Agreement.
(b) Any Collateral Proceeds that are available to repurchase
the Securities (the "Securities Collateral Proceeds") will be deposited into an
account held by the Trustee (the "Securities Collateral Account"). When the
aggregate amount of Securities Collateral Proceeds in the Securities Collateral
Account exceeds $10,000,000 (taking into account income earned on such
Securities Collateral Proceeds, if any), the Company shall make an offer to
purchase (the "Prepayment Offer") the Securities, which offer shall be in the
amount of the Securities Collateral Proceeds, on a pro rata basis according to
principal amount at maturity, at a purchase price equal to 100% of the principal
amount thereof, plus accrued and unpaid interest, if any, to the purchase date
(subject to the right of holders of record on the relevant record date to
receive interest due on the relevant interest payment date), in accordance with
the procedures (including prorating in the event of oversubscription) set forth
herein. To the extent that any portion of the amount of Securities Collateral
Proceeds remains after compliance with the preceding sentence and provided that
all Holders have been given the opportunity to tender their Securities for
purchase in accordance with this Indenture, the Company may use such excess only
to repurchase Securities in open market transactions, and otherwise such excess
must remain deposited in an account, for the sole benefit of the Securities,
which is controlled by the Trustee. The Securities will be secured by a first
priority security interest in such account. Following the completion of a
68
Prepayment Offer, the amount of Securities Collateral Proceeds will be reset to
zero.
(c) (1) Within five Business Days after the Company makes a
Prepayment Offer in accordance with paragraph (b) above, the Company shall send
a written notice, by first-class mail, to the Holders, accompanied by such
information regarding the Company and its Subsidiaries as the Company in good
faith believes will enable such Holders to make an informed decision with
respect to such Prepayment Offer. Such notice shall state, among other things,
the purchase price and the purchase date (the "Purchase Date"), which shall be,
subject to any contrary requirements of applicable law, a Business Day no
earlier than 30 days nor later than 60 days from the date such notice is mailed.
(2) Not later than the date upon which written notice of a
Prepayment Offer is delivered to the Trustee as provided above, the Company
shall deliver to the Trustee written instructions as to (i) the amount of the
Prepayment Offer (the "Offer Amount") and (ii) the allocation of the Collateral
Proceeds from the Senior Collateral Disposition, pursuant to which such
Prepayment Offer is being made. On or before the Purchase Date, the Company
shall also irrevocably deposit with the Trustee or with the Paying Agent (or, if
the Company is the Paying Agent, shall segregate and hold in trust) in U.S.
Government Obligations, maturing on the last day prior to the Purchase Date or
on the Purchase Date if funds are immediately available by open of business, an
amount equal to the Offer Amount to be held for payment in accordance with the
provisions of this Section. Upon the expiration of the period for which the
Prepayment Offer remains open (the "Offer Period"), the Company shall deliver to
the Trustee for cancellation the Securities or portions thereof that have been
properly tendered to and are to be accepted by the Company. The Trustee or the
Paying Agent shall, on the Purchase Date, mail or deliver payment to each
tendering Holder in the amount of the purchase price. In the event that the
aggregate purchase price of the Securities delivered by the Company to the
Trustee is less than the Offer Amount, the Trustee or the Paying Agent shall
deliver the excess to the Company immediately after the expiration of the Offer
Period for application in accordance with this Section.
(3) Holders electing to have a Security purchased pursuant to
the Prepayment Offer shall be required to surrender the Security, with an
appropriate form duly completed, to the Company or its agent at the address
specified in the notice at least five Business Days prior to the Purchase Date.
Holders shall be entitled to withdraw their election if the Trustee or the
Company receives not later than three Business Days prior to the Purchase Date,
a telegram, telex, facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Security that was delivered for purchase
by the Holder and a statement that such Xxxxxx is withdrawing its election to
have such Security purchased. If at the expiration of the Offer Period the
aggregate principal amount of Securities surrendered by Holders exceeds the
Offer Amount, the Company shall select the Securities to be purchased on pro
rata basis for all Securities (with such adjustments as may be deemed
appropriate by the Company so that only Securities in denominations of $1,000,
or integral multiples thereof, shall be purchased). Holders whose Securities are
69
purchased only in part shall be issued new Securities equal in principal amount
to the unpurchased portion of the Securities surrendered.
(4) At the time the Company delivers Securities to the Trustee
that are to be accepted for purchase, the Company shall also deliver an
Officers' Certificate stating that such Securities are to be accepted by the
Company pursuant to and in accordance with the terms of this Section. A Security
shall be deemed to have been accepted for purchase at the time the Trustee or
the Paying Agent mails or delivers payment therefor to the surrendering Holder.
(d) The Company will comply, to the extent applicable, with
the requirements of Section 14 (e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of the Securities pursuant
to any Prepayment Offer conducted in accordance with this Section 10.14. To the
extent that the provisions of any securities laws or regulations conflict with
the procedures with respect to a Prepayment Offer as set forth herein, the
Company will comply with the applicable securities laws and regulations and will
not be deemed to have breached its obligations under the covenant described
hereunder by virtue thereof.
SECTION 10.15. Restrictions on Permitting Unrestricted
Subsidiaries To Become Restricted Subsidiaries. (a) The Company will not permit
any Unrestricted Subsidiary to be designated as a Restricted Subsidiary unless
such Subsidiary has outstanding no Secured Debt, Funded Debt and/or Attributable
Debt in respect of Sale and Leaseback Transactions except such Secured Debt,
Funded Debt and Attributable Debt as the Company could permit it to become
liable for immediately after becoming a Restricted Subsidiary under the
provisions of Sections 10.08, 10.09 and 10.10 of this Indenture.
(b) Promptly after the adoption of any Board Resolution
designating a Restricted Subsidiary as an Unrestricted Subsidiary or an
Unrestricted Subsidiary as a Restricted Subsidiary, a copy thereof shall be
filed with the Trustee, together, in the case of the designation of an
Unrestricted Subsidiary as a Restricted Subsidiary, with an Officers'
Certificate stating that the provisions of this Section have been complied with
in connection with such designation.
SECTION 10.16. Statement by Officers as to Default. Reference
is made to Section 314(a)(4) of the Trust Indenture Act.
70
SECTION 10.17. Waiver of Certain Covenants. The Company may
omit in any particular instance to comply with any covenant or condition set
forth in Sections 10.07 to 10.14, if before the time for such compliance the
Holders of at least a majority in principal amount of the Outstanding Securities
affected thereby (voting as a class) shall, by Act of such Holders, either waive
such compliance in such instance or generally waive compliance with such
covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such covenant or condition shall remain in full
force and effect.
ARTICLE XI
Redemption of Securities
SECTION 11.01. Right of Redemption. Securities are redeemable
before their maturity only pursuant to the terms of this Indenture and the
Securities or the provisions of applicable law. If less than all the Securities
are to be redeemed, the Trustee shall select, in such manner as it shall deem
fair and appropriate, the particular Securities to be redeemed or any portion
thereof that is an integral multiple of $1,000.
The Securities will not have the benefit of any sinking fund.
SECTION 11.02. Election To Redeem; Notice To Trustee. The
election of the Company to redeem any Securities pursuant to Section 11.01 shall
be evidenced by a Board Resolution. In case of any redemption at the election of
the Company, the Company shall, at least 90 days prior to the Redemption Date
fixed by the Company (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee of such Redemption Date and of the principal amount
of Securities to be redeemed.
SECTION 11.03. Selection by Trustee of Securities To Be
Redeemed. If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 90 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities not previously
called for redemption, by such method as the Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $1,000 or any integral multiple thereof) of the principal amount of
Securities of a denomination larger than $1,000.
The Trustee shall promptly notify the Company and each
Security Registrar in writing of the Securities selected for redemption and, in
the case of any Securities selected for partial redemption, the principal amount
thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
71
SECTION 11.04. Notice of Redemption. Notice of redemption
shall be given by first-class mail, postage prepaid, mailed not less than 30 nor
more than 90 days prior to the Redemption Date, to each Holder of Securities to
be redeemed, at his address appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price (or formula for calculating the
same),
(3) if less than all the Outstanding Securities are to be
redeemed, the identification (and, in the case of partial
redemption, the principal amounts) of the particular Securities to
be redeemed,
(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Security to be redeemed and
that interest thereon will cease to accrue on and after said date,
(5) the place or places where such Securities are to be
surrendered for payment of the Redemption Price, and
(6) CUSIP numbers of the Securities to be redeemed (if any).
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company.
SECTION 11.05. Deposit of Redemption Price. Prior to any
Redemption Date, the Company shall deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in Section 10.03) an amount of money sufficient to pay the
Redemption Price of, and (except if the Redemption Date shall be an Interest
Payment Date) accrued interest on, all the Securities which are to be redeemed
on that date.
SECTION 11.06. Securities Payable on Redemption Date. Notice
of redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price plus accrued interest) such
Securities shall cease to bear interest. Upon surrender of any such Securities
for redemption in accordance with said notice, such Security shall be paid by
the Company at the Redemption Price together with accrued interest to the
Redemption Date; provided, however, that installments of interest whose Stated
Maturity is on or prior to the Redemption Date shall be payable to the Holders
of such Securities, or one or more Predecessor Securities, registered as such at
the close of business on the relevant Record Dates according to their terms and
the provisions of Section 3.07.
72
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate provided
by the Security.
SECTION 11.07. Securities Redeemed in Part. Any Security which
is to be redeemed only in part shall be surrendered at an office or agency of
the Company designated for that purpose pursuant to Section 10.02 (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing), and the
Company shall execute, and the Trustee shall authenticate and make available for
delivery to the Holder of such Security without service charge, a new Security
or Securities, of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.
ARTICLE XII
Defeasance and Covenant Defeasance
SECTION 12.01. Company's Option To Effect Defeasance or
Covenant Defeasance. The Company may at its option by Board Resolution, at any
time, in accordance with the Exchange and Registration Rights Agreement, elect
to have either Section 12.02 or Section 12.03 applied to the Outstanding
Securities upon compliance with the conditions set forth below in this Article
XII.
SECTION 12.02. Defeasance and Discharge. Upon the Company's
exercise of the option provided in Section 12.01 applicable to this Section, the
Company shall be deemed to have been discharged from its obligations with
respect to the Outstanding Securities on the date the conditions set forth below
are satisfied (hereinafter, "defeasance") If the Company exercises its
defeasance option or its covenant defeasance option, each Subsidiary Guarantor,
if any, shall be released from all its obligations under (i) the Subsidiary
Guarantee Agreement and the Second Priority Collateral Documents, and (ii) the
Second Priority Lien and the Second Priority Mortgages, as they pertain to the
Securities, shall be released. For this purpose, such defeasance means that the
Company shall be deemed to have paid and discharged the entire indebtedness
represented by the Outstanding Securities and to have satisfied all its other
obligations under such Securities and this Indenture insofar as such Securities
are concerned (and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging the same) except for the following which shall
survive until otherwise terminated or discharged hereunder: (A) the rights of
Holders of such Securities to receive, solely from the trust fund described in
Section 12.04 and as more fully set forth in such Section, payments in respect
of the principal of (and premium, if any) and interest on such Securities when
such payments are due, (B) the Company's obligations with respect to such
Securities under Sections 3.04, 3.05, 3.06, 10.02 and 10.03, (C) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and (D) this
Article XII. Subject to compliance with this Article XII, the Company may
exercise its option under this Section 12.02 notwithstanding the prior exercise
of its option under Section 12.03.
73
SECTION 12.03. Covenant Defeasance. Upon the Company's
exercise of the option provided in Section 12.01 applicable to this Section, (i)
the Company and each Subsidiary Guarantor shall be released from their
respective obligations under Sections 10.05 through 10.14, inclusive, and
clauses (3) and (4) of Sections 8.01(a) and (b), (ii) the occurrence of an event
specified in Sections 5.01(3) (with respect to clause (1), (3) or (4) of
Sections 8.01(a) and (b)), 5.01(4) (with respect to any of Sections 10.05
through 10.14, inclusive), 5.01(5), 5.01(6), 5.01(9) and 5.01(10) shall not be
deemed to be an Event of Default shall cease to be effective on and after the
date the conditions set forth below are satisfied (hereinafter, "covenant
defeasance"). For this purpose, such covenant defeasance means that the Company
or the Subsidiary Guarantors, as the case may be, may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such Section, clause or Article, whether directly or indirectly by
reason of any reference elsewhere herein to any such Section, clause or Article
or by reason of any reference in any such Section, clause or Article to any
other provision herein or in any other document, but the remainder of this
Indenture and such Securities shall be unaffected thereby.
SECTION 12.04. Conditions to Defeasance or Covenant
Defeasance. The following shall be the conditions to application of either
Section 12.02 or Section 12.03 to the then Outstanding Securities:
(1) The Company shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satisfying the
requirements of Section 6.09 who shall agree to comply with the
provisions of this Article XII applicable to it) as trust funds in
trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of such Securities, (A) money in an amount, or (B) U.S.
Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due date of
any payment, money in an amount, or (C) a combination thereof,
sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and which
shall be applied by the Trustee (or other qualifying trustee) to pay
and discharge, the principal of, premium, if any, and each
installment of interest on the Securities on the Stated Maturity of
such principal or installment of interest in accordance with the
terms of this Indenture and of such Securities.
(2) In the case of an election under Section 12.02, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (x) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (y) 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 shall confirm that, the Holders of the
Outstanding Securities will not recognize gain or loss for Federal
income tax purposes as a result of such deposit, defeasance and
discharge and will be subject to Federal income tax on the same
74
amount, in the same manner and at the same times as would have been
the case if such deposit, defeasance and discharge had not occurred.
(3) In the case of an election under Section 12.03, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of the Outstanding Securities will not
recognize gain or loss for Federal income tax purposes as a result
of such deposit and covenant defeasance and will be subject to
Federal income tax on the same amount, in the same manner and at the
same times as would have been the case if such deposit and covenant
defeasance had not occurred.
(4) The Company shall have delivered to the Trustee an
Officers' Certificate to the effect that the Securities, if then
listed on any securities exchange, will not be delisted as a result
of such deposit.
(5) Such defeasance or covenant defeasance shall not cause the
Trustee to have a conflicting interest as defined in Section 6.08
and for purposes of the Trust Indenture Act with respect to any
securities of the Company.
(6) No Event of Default or event which with notice or lapse of
time or both would become an Event of Default shall have occurred
and be continuing.
(7) Such defeasance or covenant defeasance shall not result in
a breach or violation of, or constitute a default under, any other
agreement or instrument to which the Company is a party or by which
it is bound.
(8) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that
all conditions precedent provided for relating to either the
defeasance under Section 12.02 or the covenant defeasance under
Section 12.03 (as the case may be) have been complied with.
(9) Such defeasance or covenant defeasance shall not result in
the trust arising from such deposit constituting an investment
company as defined in the Investment Company Act of 1940, as
amended, or such trust shall be qualified under such act or exempt
from regulation thereunder.
SECTION 12.05. Deposited Money and U.S. Government Obligations
To Be Held in Trust; Other Miscellaneous Provisions. Subject to the provisions
of the last paragraph of Section 10.03, all money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee -- collectively, for purposes of this Section 12.05,
the "Trustee") pursuant to Section 12.04 in respect of the Securities shall be
held in trust and applied by the Trustee, in accordance with the provisions of
such Securities and this Indenture, to the payment, either directly or through
any Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Securities, of all sums due and to
become due thereon in respect of principal (and premium, if any) and interest,
but such money need not be segregated from other funds except to the extent
required by law.
75
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 12.04 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 Securities.
Anything in this Article XII to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 12.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent defeasance or covenant
defeasance.
SECTION 12.06. Reinstatement. If the Trustee or the Paying
Agent is unable to apply any money in accordance with Section 12.02 or 12.03 by
reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Company's obligations under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to this Article XII
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 12.02 or 12.03; provided, however, that if the
Company makes any payment of principal of (and premium, if any) or interest on
any Security following the reinstatement of its obligations, the Company shall
be subrogated to the rights of the Holders of such Security to receive such
payment from the money held by the Trustee or the Paying Agent.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
76
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
RITE AID CORPORATION,
By:______________________________
Name: Xxxxxx Xxxxxx
Title: Authorized Signatory
THRIFTY PAYLESS, INC., as a
Subsidiary Guarantor,
By:______________________________
Name: Xxxxxx Xxxxxx
Title: Authorized Signatory
EACH OF THE SUBSIDIARY GUARANTORS
LISTED ON SCHEDULE A HERETO,
By:______________________________
Name: Xxxxxx Xxxxxx
Title: Authorized Signatory
STATE STREET BANK AND TRUST
COMPANY, as Trustee
By:______________________________
Name: Xxxx X. Xxxxxxxx
Title: Vice President
SCHEDULE A
000 Xxxxxxxx Xxxxxx Norfolk, LLC
0000 Xxxx Xxxxx Xxxxxx Xxxxx, Xxxxx, LLC
0000 Xxxxxxx Xxxx-Brooklyn Inc.
1740 Associates, LLC
0000 Xxxxxx Xxxx Xxxx-Xxxxxxxxxx Corp.
0000 Xxxxxxxxxxxx Xxxxxx Xxxx-Xxxxxxxxxxxx Xxxx, Inc.
5277 Associates, Inc.
000 Xxx Xxxxxx Corporation
5600 Superior Properties, Inc.
000-000 Xxxxxxxx Xx. Corp.
000 Xxxxx Xxxxxxxx-Xxxxxx, Xxxx, LLC
Xxx & Government Streets-Mobile, Alabama, LLC
Apex Drug Stores, Inc.
Baltimore/Annapolis Boulevard & Governor Xxxxxx Xxx-Glen Burnie, MD, LLC
Broadview and Wallings-Broadview Heights Ohio, Inc.
Central Avenue and Main Street-Petal, MS, LLC
Dominion Action Four Corporation
Dominion Action One Corporation
Dominion Action Three Corporation
Dominion Action Two Corporation
Dominion Drug Stores Corporation Drug Fair of PA, Inc.
Drug Fair, Inc.
Eagle Managed Care Corp.
Eighth and Water Streets-Ulrichsville, Ohio, LLC
England Street-Asheland Corporation GDF, Inc.
Gettysburg and Xxxxxx-Dayton, Ohio, LLC
Gratiot & Center-Saginaw Township, Michigan, LLC
Harco, Inc.
Xxxxx Xxxxxx Xxxxxx Corporation
K&B Alabama Corporation
K&B Florida Corporation
K&B Louisiana Corporation
K&B Mississippi Corporation
K&B Services, Inc.
K&B Tennessee Corporation
K&B Texas Corporation
K&B Trainees, Inc.
K&B, Incorporated
Xxxx & Xxxxxxxx, Inc.
Keystone Centers, Inc.
Lakehurst and Broadway Corporation
Xxxxxxxx & Chillicothe Roads-Chesterland, LLC
Xxxxxx & Xxxxxxx LLC
Name Rite, LLC
Northline & Xxx-Xxxxxx-Southgate, LLC
Ocean Acquisition Corporation
P.L.D. Enterprises, Inc.
Xxxxxx Drive and Navy Boulevard Property Corporation
Paw Paw Lake Road & Paw Paw Avenue-Coloma, Michigan, LLC
PDS-1 Michigan, Inc.
Perry Distributors, Inc.
Perry Drug Stores, Inc.
PL Xpress, Inc.
Portfolio Medical Services, Inc.
Rack Rite Distributors, Inc.
Ram-Utica, Inc.
RDS Detroit, Inc.
Reads, Inc.
Rite Aid Drug Palace, Inc.
Rite Aid Hdqtrs. Corp.
Rite Aid of Alabama, Inc.
Rite Aid of Connecticut, Inc.
Rite Aid of Delaware, Inc.
Rite Aid of Florida, Inc.
Rite Aid of Georgia, Inc.
Rite Aid of Illinois, Inc.
Rite Aid of Indiana, Inc.
Rite Aid of Kentucky, Inc.
Rite Aid of Maine, Inc.
Rite Aid of Maryland, Inc.
Rite Aid of Massachusetts, Inc.
Rite Aid of Michigan, Inc.
Rite Aid of New Hampshire, Inc.
Rite Aid of New Jersey, Inc.
Rite Aid of New York, Inc.
Rite Aid of North Carolina, Inc.
Rite Aid of Ohio, Inc.
Rite Aid of Pennsylvania, Inc.
Rite Aid of South Carolina, Inc.
Rite Aid of Tennessee, Inc.
Rite Aid of Vermont, Inc.
Rite Aid of Virginia, Inc.
Rite Aid of Washington, D.C., Inc.
Rite Aid of West Virginia, Inc.
Rite Aid Realty Corp.
Rite Aid Rome Distribution Center, Inc.
Rite Aid Transport, Inc.
2
Rite Aid Venturer #1, Inc.
Rite Fund, Inc.
Rite Investments Corporation
RX Choice, Inc.
Script South
Seven Mile and Evergreen-Detroit, LLC
Silver Springs Road-Baltimore, Maryland/One, LLC
Silver Springs Road-Baltimore, Maryland/Two, LLC
Sophie One Corp.
State & Fortification Streets-Jackson, Mississippi, LLC
State Street and Hill Road-Xxxxxx, Ohio, LLC
Super Distributors, Inc.
Super Ice Cream Suppliers, Inc.
Super Laboratories, Inc.
Super Pharmacy Network, Inc.
Super Tobacco Distributors, Inc
The Lane Drug Company
The Xxxx Company
Thrifty Corporation
Thrifty Payless, Inc
Thrifty Wilshire, Inc.
Tyler and Xxxxxxx Roads, Birmingham- Alabama, LLC
Virginia Corporation
W.R.A.C., Inc.
Fairground, LLC
Xxxxxxxxxx'x Enterprises, Inc.
Leader Drugs, Inc.
3